In order to meet the requirements of placing an acquisition offer for the debt- ridden Indian steel firm, Essar Steel, on Wednesday, ArcelorMittal SA announced that it will par 74.69 billion rupees ($1.01 billion) to creditors of two Indian companies namely Uttam Galva Steels and oil and gas pipeline construction services provider KSS Petron in which it previously held stakes until earlier this year.
Two weeks after India’s top court declared the condition for ArcelorMittal to fulfill in order to make its bid for Essar Steel valid was to clear outstanding dues pertaining to Uttam Galva Steels and KSS Petron, ArcelorMittal made this move.
ArcelorMittal’s bid for Essar Steel was raised in September after it formed a joint venture with Nippon Steel of Japan and Sumitomo Metal Corp.
Creditors committee of Essar steel has an eight- week period to study and evaluate the bids for the company.
In order to bid for Essar Steel being auctioned as part of insolvency proceedings, ArcelorMittal sold its stake in Uttam Galva and KSS Petron to free up its capital.