The National Company Law Appellate Tribunal (NCLAT) on Wednesday refused to stay the delisting process of debt-ridden firm ElectroSteel Steel under the resolution plan by its bidder Vedanta Ltd.
A two-member bench headed by Chairman Justice S J Mukhopadhaya refused to stay delisting of Electrosteel Steel, over the plea filed by Renaissance Steel, whose bid was rejected by the Committee of Creditors (CoC) of the debt ridden firm.
The appellate tribunal said that any steps over Electrosteel would be subject to the outcome of its final decision.
The NCLAT is already hearing a petition filed by Renaissance Steel, challenging the Vedanta's bid for Electrosteel.
Earlier, on May 30, the NCLAT had allowed Vedanta Ltd to make an upfront payment of Rs 5,320 crore to lenders for acquiring Electrosteel Steels.
The bench had also clarified that this payment would be subject to the outcome of the petition filed by Renaissance Steel challenging Vedanta's bid.
"It is made clear that if the appeal preferred by the Appellant (Renaissance Steel) is allowed and we set aside the approved plan, in such case the Committee of Creditors will have to refund the amount," the tribunal has said on May 30.
On June 5, Electrosteel had informed that the stock exchanges that Vedanta's resolution plan provides that it would be delisted on completion of transaction.
"The Resolution Plan further provides that the Company would stand delisted on completion of the Transaction Steps The Resolution Plan further provides an exit price to be offered to the public shareholders of the Company, " it had said.
Electrosteel Steels on June 21 informed that Rs 5,320 crore has been remitted to its financial creditors as per the resolution plan approved by the NCLT.
In April, the NCLT had approved the resolution plan submitted by Vedanta Ltd for Electrosteel Steels, making it first among the 12 large stressed accounts identified by RBI last year to get resolved under the Insolvency and Bankruptcy Code.
On May 17, NCLAT admitted the petition of Renaissance Steel challenging Vedanta's bid for debt-ridden Electrosteel.
Renaissance Steel's resolution application was rejected by the CoC of Electrosteel Steels.
On May 1, NCLAT had directed maintaining status quo in the case pertaining to the sale of the debt-laden firm to Vedanta Ltd.
Electrosteel owes lenders more than Rs 13,000 crore, of which about Rs 5,000 crore is to State Bank of India alone.In April, the Kolkata bench of the National Company Law Tribunal (NCLT) had cleared Vedanta's Rs 5,320-crore resolution plan for Electrosteel, rejecting objections by Renaissance Steel.