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After raising its bid for Essar Steel, ArcelorMittal is eyeing the Ruias' EPC Constructions India that is under ongoing insolvency proceedings. According to an Economic Times report, the Luxembourg-headquartered steel giant has expressed interest in acquiring the Indian conglomerate's engineering, procurement and constructions (EPC) arms.
ArcelorMittal is believed to have picked up expression-of-interest documents for the EPC Construction bid last week.
"ArcelorMittal is keen to expand Essar Steel’s capacity to 20 million tonnes. EPC Constructions has been involved in building the Hazira facility along with other associated infrastructure, so it can offer additional synergies," an official told the paper.
Other potential bidders for EPC Constructions are New Delhi-based Alchemist ARC and Mauritius-based Royale Partners Investment Fund (RPIF).
The resolution professional of EPC Constructions, Abhijit Guha Thakurta, is expected to invite proposals by September-end, following which financial bids would be submitted, the paper reported.
Moneycontrol could not independently verify the report.
The Mumbai bench of the National Company Law Tribunal (NCLT) in May had directed the initiation of insolvency proceedings against EPC Constructions based on a petition by IDBI Bank, which was looking to recover Rs 969 crore from the company.
The company has outstanding debt of Rs 6,000 crore, of which Rs 4,000 crore is the principal amount. It clocked revenues of Rs 2,000 crore in FY17, while its FY18 order book stood at almost Rs 8,000 crore.
EPC Construction has performed work for Essar Steel and has built all steelworks, refineries and ports for the group.
ArcelorMittal's move is in line with its long-term aspiration to grow Essar’s steel-making capacity.
Other lenders of EPC Constructions including ICICI Bank, Axis Bank, Yes Bank, Dena Bank and Central Bank of India have reportedly asked for a detailed plan from the resolution professional to settle their dues.
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