Deadline for Bhushan Power bids extended

MUMBAI: The higher bench of the bankruptcy court has extended the deadline for applicants to submit revised debt resolution plans for Bhushan Power & Steel under the Insolvency and Bankruptcy Code by a week to August 13.

National Company Law Appellate Tribunal (NCLAT) on Monday directed all the three bidders — Tata Steel, JSW Steel and Liberty House — to submit unconditional bids to the court in a sealed envelope on or before next Monday.

The decision means that the revised bids will be opened after the Supreme Court hears a Tata Steel appeal challenging NCLAT’s order that permitted the resolution professional (RP) for Bhushan Power & Steel to accept revised bids. The top court is scheduled to hear the plea on August 10.


The next hearing of NCLAT is scheduled for August 17.

In the first round of bidding, which closed on February 8, Tata Steel had offered Rs 17,000 crore and JSW Steel offered Rs 11,000 crore. Liberty House had made Rs 18,500-crore bid 12 days after the deadline. Lenders were forced to consider Liberty’s offer following a directive by NCLAT.

Early last month, lenders declared Tata Steel as H1, or the highest bidder, and JSW Steel H2, while disqualifying Liberty that had failed to furnish critical information about funding arrangement within the stipulated timeframe. On July 27, JSW Steel revised their offer by 60% to rs 18000 crore following which lenders decided to invite revised bids from all applicants. But Tata's objected to this proposal.

On August 1, the higher bench of bankruptcy court allowed lenders to accept revised bids after JSW Steel revised its offer by 60% to Rs 18,000 crore from Rs 11,000 crore.

This prompted Tata Steel to move the Supreme Court.

According to lenders, the revised offer from JSW Steel changed the entire matrix. While they are hopeful on lower haircut, the resolution might be delayed further due to litigations.

Sanjay Singal-promoted Bhushan Power & Steel is among the 12 companies that the Reserve bank of India (RBI) had directed banks to refer to the bankruptcy court. It faces claims of Rs 49,264 crore from financial creditors.

Of the 12 accounts referred to the bankruptcy court a year ago, only in two cases — Bhushan Steel and Electrosteel Steels — banks have received the settlement amount. The court has also approved resolution plans of Amtek Auto and Monnet Ispat, but lenders are yet to receive settlement amounts from their respective bidders.

Among others, liquidation is ordered for Jyoti Structures and Lanco Infratech while the remaining cases, including Essar Steel and Jaiprakash Infra, are under litigation.