One more NPA resolution under IBC! AION-JSW consortia gets NCLT nod to acquire bankrupt Monnet Ispat

By: | Updated: July 19, 2018 7:44 PM

NPA resolution under IBC: The AION Capital-JSW Steel consortium bid has got the official nod from National Company Law Tribunal (NCLT) for acquiring bankrupt Monnet Ispat and Energy Ltd.

One more NPA resolution under IBC! JSW Steel-AION gets NCLT nod to acquire bankrupt Monnet IspatThe JSW Steel-AION Capital consortium bid has got the official nod from NCLT for Monnet Ispat

NPA resolution under IBC: The AION Capital-JSW Steel consortium bid has got the official nod from National Company Law Tribunal (NCLT) for acquiring bankrupt Monnet Ispat and Energy Ltd, CNBC-TV18 reported. The NCLT, however, has suggested some modification, the details for which are not known yet.

The consortium, the sole bidder, was officially declared a successful bidder in April with an offer of reportedly Rs 2,850 crore against the dues of Rs 10,000 crore. Monnet Ispat was one of the 12 accounts with massive dues identified by the Reserve Bank of India as ‘Dirty Dozen’ for an immediate resolution last year.

With AION Capital-JSW Steel consortium bid getting the official nod from the NCLT for resolution, it has become the third big resolution under the Insolvency and Bankruptcy Code (IBC). In a first, Tata Steel acquired Bhushan Steel, followed by Vedanta’s overtake of Electrosteels Steel. Reliance Industries-JM Financial ARC consortium has won the bid of Alok Industries but is awaiting NCLT approval.

The IBC law was adopted in 2016 to clean up banks’ book burdened by massive NPAs, which by then had risen to about Rs 11 lakh crore. By April 2017, the RBI was vested with more powers to initiate resolution of accounts with huge amount of outstanding dues. In June 2017, the RBI identified 12 big accounts, which constituted 25% of total NPAs.

Of the 12, resolution for two (Bhushan Steel and Electrosteels) have been completed; one (Monnet) has reached the final stage; the other nine are in the pipeline. In February, the RBI issued a circular of new rules subsuming a dozen resolution plans in tandem with pace and timeline set under the IBC. The new framework sets a strict 180-day resolution plan for NPAs.

Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Switch to Hindi Edition