SBI refuses terms of JSW's offer to buy Monnet Ispat; next hearing on Monday
National Company law Tribunal was hearing the case filed by SBI under the Insolvency and Bankruptcy Code (IBC), filed on a priority basis following RBI’s circular on June 13.
A bid by the Sajjan Jindal-led JSW Group to take over assets of the debt-laden Monnet Ispat and Energy is not acceptable in its current form, State Bank of India told the National Company Law Tribunal (NCLT) on Thursday.
New Delhi-based Monnet Ispat is among the 12 accounts against which banks have initiated insolvency proceedings following an RBI directive. Lenders including SBI, Punjab National Bank and IDBI Bank currently own over 51 percent of the total shares in the company.
SBI, which is the lead banker in the consortium, told the Mumbai bench of NCLT that Monnet Ispat had outstanding dues worth Rs 2,200 crore, while the default of loans stood at Rs 1,500 crore.
The bench then asked SBI to clarify whether they were pressing the application on basis of dues or default and adjourned the matter till Monday, July 17.
The tribunal was hearing the case filed by SBI under the Insolvency and Bankruptcy Code (IBC), filed on a priority basis following the RBI’s circular on June 13.
On Tuesday, Monnet Ispat reported its 12th consecutive quarterly loss at Rs 399.79 crore for the June quarter due to lower sales and higher interest cost.
The company's debt as on March had surged to nearly Rs 12,115 crore after it faced severe financial crunch owing to the drop in commodity prices and huge steel imports from China.
Lenders had invoked the strategic debt restructuring (SDR) scheme to convert the company's debt into equity in August 2015, but failed to find a new investor till the JSW Group expressed interest at the start of this year.
Meanwhile, a winding up petition has been filed by creditors of the company at the Chhattisgarh High Court, Monnet’s Ispat’s lawyers informed the NCLT on Thursday. The tribunal was told that the High Court, while dismissing an earlier petition, had permitted the creditors to file a fresh petition.On Thursday, the shares of Monnet Ispat ended 4 percent weaker at Rs 32.25 apiece on BSE.