The NCLAT on Thursday declined a request from the committee of creditors asking Tata Steel and UK-based Liberty House be allowed to submit fresh bids for the bankrupt Bhushan Power and Steel. However, bids from both parties are to be evaluated, as per the NCLAT’s orders on May 9.
The decision is important since Liberty’s bid had come in only on February 20, well past the deadline of February 8.
The NCLAT also directed that the identity of the highest bidder was not to be disclosed until it passed a final order.
“Approval of one or the other would be kept in a sealed cover,” the NCLAT bench headed by chairman justice SJ Mukhopadhaya said. The appellate body has fixed July 12 as the next date of hearing in the matter.
The NCLT had earlier on April 23 directed the lenders of Bhushan Power and Steel, led by Punjab National Bank, to consider the late bid submitted by Liberty House.
Tata Steel, which had emerged as the highest bidder for Bhushan Power, had challenged the NCLT’s order to allow LIberty House’s bid to be considered. On May 9, however, the appellate tribunal had asked lenders to consider the bid by Liberty House but not disclose the identity of the highest bidder till it decides on the petition.
Apart from Tata Steel, JSW Steel was the only other bidder which had submitted a bid before the deadline ended on February 8. Liberty House had placed its bid for the company on February 20 and the resolution professional Mahender Khandelwal had rejected it on the ground that it been submitted after the deadline.
Liberty House had challenged the RP’s decision in the NCLT which had observed that its bid could not be disqualified only on the grounds that it was submitted after the deadline.
Tata Steel had reportedly offered to make an upfront payment of Rs 17,000 crore to 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 figured among the 12 large non-performing assets (NPAs) referred for insolvency proceedings by banks following a nudge from the Reserve Bank of India (RBI) in June last year. The company owes lenders over Rs 47,000 crore, as on March 31, 2017.