Essar Steel lenders to meet on August 31 to decide on resolution plan: Sources

Essar Steel's lenders will be holding their first meeting on August 31 to decide on a resolution plan to deal with the company's debt, sources tell CNBC-TV18.

Sources further add that lenders are keen to rope in a new investor for Essar Steel and change its promoter.

Alvarez & Marsal has been appointed interim resolution professional for Essar Steel.

CNBC TV-18 further learns from sources that over 6 suitors have informally expressed interest in acquiring controlling stake in Essar Steel. The six include - Tata Steel, JSW Steel, ArcelorMittal, SSG International, Posco and Liberty House. Tata Steel told CNBC TV-18 that they are evaluating various strategic opportunities on an ongoing basis.

If the suitors decide to take up a major stake in Essar Steel, they are likely to go through haircuts.

CNBC TV-18 reports that a committee of creditors has been formed where Essar Steel will present their resolution plan. Essar Steel owes a total of Rs 45,000 crore to 22 lenders led by State Bank of India. Essar Steel is confident that their resolution plan will be accepted as they are learnt to not be looking for prospective bidders.

Also read: Timeline of Events: Essar Steel

Essar Steel was one among the 12 NPA accounts identified by the Reserve Bank of India to be referred to the NCLT. The company also challenged RBI's decision in the Gujarat High Court where their plea was denied.