The other bidders in the fray so far include Tata Steel, which is likely not be very aggressive in bidding, while Vedanta and JSW Steel are unlikely to submit binding offers leaving it a two-way fight between the two.
The battle to gain control of the Essar Steel has boiled down to two contenders Lakshmi Mittal-led ArcelorMittal and Numetal Mauritius as the deadline to submit bid ends on Monday, according to a report in the Economic Times.
The other bidders in the fray so far include Tata Steel which is not likely to bid very aggressively, while Vedanta and JSW Steel are unlikely to submit binding offers leaving it a two-way fight between the two, the report said.
Rewant Ruia-led Numetal Mauritius is a special purpose vehicle (SPV) which has Russian Bank VTB as the largest shareholder with 40 percent stake and Ruias holding around 26 percent stake. The other partner in the SPV is Tyazprom Export (TPE) of Russia, a construction engineering and management consulting company which specialises in steelworks.
The report said that being a minority partner in the SPV will not violate the related party clauses of the Insolvency and Bankruptcy Code (IBC). Numetal is likely to have bid in the region of Rs 35,000-40,000 crore be more aggressive
Numetal is likely to offer an all-cash offer that could garner more attention from the lenders as they will get less cash component and need to take a haircut from other bidders.
The Russian government owns 60.9 percent in VTB Bank that arranged a facility agreement to provide up to USD 3.9 billion for refinancing debt at Essar Global Fund Ltd in preparation for the sale of Essar Oil.
Essar Steel was one of the 12 stressed account identified by the Reserve Bank of India last year to go for Insolvency and bankruptcy proceeding.Essar Steel operates a 10-million tonne plant in Gujarat and owes more than Rs 45,000 crore to lenders.