Kolkata: Anil Agarwal-promoted Vedanta has acquired the management control of the debt-ridden Electrosteel after its resolution plan was approved by the National Company Law Tribunal under the IBC.
"... Vedanta Star Limited has acquired management control of Electrosteel Steels pursuant to resolution plan approved under the Insolvency and Bankruptcy Code (IBC), 2016," Vedanta said in a regulatory filing.
In view of the approved resolution plan, an upfront amount has been deposited in the escrow account of Electrosteel and a new board of directors has been put in place, the filing said.
Upon implementation of the resolution plan, Vedanta would hold approximately 90 per cent of the paid up share capital of Electrosteel. The remaining 10 per cent would be held by Electrosteel's existing shareholders and the financial creditors who receive shares in exchange for the debt owed to them, Vedanta said earlier in a statement.
The funds received by Electrosteel as debt and equity will be used to fully settle the debts owed to the existing financial creditors of Electrosteel by payment of Rs 5,320 crore, it said.
Electrosteel owns and operates a greenfield integrated steel manufacturing facility near Bokaro, Jharkhand which has a current capacity of 1.5 million tonnes per annum (mtpa) and the potential to increase to 2.5 mtpa.