MUMBAI: Tata Steel trumped JSW with an aggressive allcash bid for 5 million tonne Bhushan Steel and Power, one of the largest non-performing assets in the Indian banking system, said people with knowledge of the matter.
It has offered an upfront cash payment of Rs 35,200 crore and 12.2% equity to the lenders. JSW has offered an upfront cash payment of Rs 28,000 crore and no equity, said the persons cited above. A third bid came from Bhushan Steel employees who said they will pay Rs 50 crore cash upfront and another Rs 28,600 crore over 13 years while offering 98% equity to the lenders.
The promoters of Bhushan owe Rs 56,000 crore to financial creditors. The bids were opened in a hotel in New Delhi on Friday at a meeting of Bhushan Steel’s committee of creditors. The Tata offer came as a relief to banks as lenders face the prospect of more substantial haircuts in bankruptcy proceedings at the National Company Law Tribunal (NCLT). That should allow banks to write back some of their provisions since they provided for bigger losses on the debt previously.