Tata Steel Completes Acquisition Of Bhushan Steel

Mumbai: Tata Steel Limited on Friday announced that its wholly-owned subsidiary, Bamnipal Steel Limited (BNPL), has successfully completed the acquisition of controlling stake of 72.65% in Bhushan Steel Limited (BSL) in accordance with the approved resolution plan under the Corporate Insolvency Resolution Process (CIRP) of the Insolvency and Bankruptcy Code 2016 (IBC) which has been managed by Vijaykumar V. Iyer, partner, Deloitte Touche Tohmatsu India LLP in his capacity as the resolution professional.

The admitted CIRP cost and employee dues have been paid, as required under IBC.

Further, settlement of the amounts equivalent to Rs 35,200 crore towards financial creditors of BSL is being undertaken as per the terms of the resolution plan and corresponding transaction documents. Rs 1,200 crore will be paid to the operational creditors of BSL over a period of 12 months as per their admitted claims and as per the terms of the approved Resolution Plan.

The investment from BNPL in BSL has been done through a combination of an equity of Rs 158.89 crore and inter-corporate loan of Rs 34,973.69 crore. Besides, Rs 100 crore has been paid by BNPL to the financial creditors of BSL as consideration for novation of the remaining financial debt of BSL.

The acquisition is being financed through a combination of an external bridge loan of Rs 16,500 crore availed by BNPL and balance amount through investment by Tata Steel in BNPL. The bridge loan availed by BNPL is expected to be replaced by debt raised at BSL over time.

Pursuant to the acquisition, the nominees of BNPL have been appointed on the board of BSL and the existing directors of BSL are deemed to have resigned from its board as per the terms of the approved resolution plan.

As per the Resolution Plan approved by NCLT, BNPL shall be classified as the ‘promoter’ of BSL, and the existing promoters/promoter group shall be re-classified from the promoters/promoter group to public shareholders of BSL for the purposes of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.