The National Company Law Appellate Tribunal (NCLAT) on Wednesday allowed the three bidders — Tata Steel, JSW Steel and Liberty House — in the fray for the bankrupt Bhushan Power and Steel (BPSL) to submit revised bids. The appellate tribunal’s direction came in response to a petition filed by Tata Steel, which had objected to the committee of creditors’ (CoC) decision last week allowing JSW Steel to submit a revised offer. The NCLAT’s two-member bench, headed by its chairperson justice
SJ Mukhopadhyay, ordered that all the three companies would submit their revised bids by August 6 to the CoC for its approval.
The CoC will consider and evaluate these bids and identify the highest bidder, but put it in a sealed cover until the appellate tribunal passes an order on the original petition of Tata Steel on whether the late bid submission by Liberty House initially should be seen as valid or not.
The NCLAT will next hear the matter on August 17.
During Wednesday’s proceedings, the lenders’ counsel sought the bench’s permission for allowing it to consider the revised bids as it would “maximise” returns.
The case of Bhushan Steel and Power has gone through several twists and turns in the last few months. On July 20 the NCLAT had directed the CoC to convene its meeting and consider all the three bids — Tata Steel, JSW Steel and Liberty House — and decide the H1 and H2 bidders and submit the proposal to the National Company Law Tribunal (NCLT) for adjudication.
However, it had added that while the NCLT may decide which is the better bid — H1 or H2 — based on the recommendation of the CoC, it will not disclose it till the appellate tribunal decides on the eligibility of Liberty House.
When the CoC subsequently met last week as part of this direction, JSW Steel expressed its desire to revise its bid. The CoC allowed it, which was objected to by Tata Steel, which moved to the NCLAT challenging this. Meanwhile at the CoC meeting on July 31 the lenders chose Tata Steel’s bids as the most preferred one. However, with the NCLAT now allowing fresh bids, the CoC’s decision has been superseded.
The race for the bankrupt company had taken a turn on April 23 when the NCLT had asked its lenders led by Punjab National Bank to consider the late bid submitted by UK-based Liberty House.
Liberty House had, on February 26, challenged the rejection of its bid by the resolution professional (RP) on the grounds that it had been submitted late. The two bidders that had submitted their bids within the February 8 deadline were Tata Steel and JSW Steel.
On May 8, Tata Steel had challenged the NCLT’s order on the consideration of Liberty’s bid in the appellate tribunal.
Tata Steel had reportedly offered to make an upfront payment of Rs 17,000 crore to the lenders, way better than JSW Steel’s offer of an upfront payment of Rs 11,000 crore. According to sources, Liberty House has offered to pay bankers Rs 18,500 crore upfront, though this could not be confirmed.
Bhushan Power and Steel owed lenders close to Rs 47,000 crore, as on March 31, 2017.
Bhushan Power and Steel was among the 12 non-performing assets the Reserve Bank of India had referred for insolvency proceedings in June last year.