JSW Steel decided to join the battle for Essar Steel assets after Numetal approached the company.
JSW Steel decided to join the battle for Essar Steel assets after Numetal approached the company, and it does not foresee any monopoly scenario arising with it coming as an investor along with Numetal to bid for Essar Steel — which is going through insolvency proceedings under the Insolvency and Bankruptcy Code, 2016.
Responding to FE’s queries on what made the company change its mind to participate in the Essar Steel bid, Seshagiri Rao, joint managing director and group CFO, JSW Steel, said the decision to bid along with Numetal was finalised in two-three days. “This was the last asset available under IBC which we were interested in, but we were not allowed and there was no chance to participate. Then Numetal approached us and the opportunity came back, so we decided to go ahead…it was all decided in just two to three days,” Rao said.
The Sajjan Jindal-led JSW Steel, which did not bid for Essar Steel in the first round, on Monday confirmed it was partnering with Numetal Steel.
In a news conference last week, Sajjan Jindal, chairman, JSW Group, had said the company was not allowed to put in a bid for Essar Steel by the lenders in the second round because it did not participate in the EOI (expression of interest) during the first round of bidding. Jindal had also ruled out the possibility of partnering with an existing bidder for Essar Steel.
Commenting on JSW Steel coming into the fray for the beleaguered company, ArcelorMittal — another bidder for Essar Steel — said in a statement: “JSW joining Numetal is clearly a defensive move — they don’t want competition. But competition is good for the country’s industry and good for consumers. Also, India has an ambitious target to increase its steel production to 300 million tonnes. It needs new players to achieve that. We continue to believe ArcelorMittal and Nippon are the strongest possible partner for Essar.”