ArcelorMittal participates in asset trading with Essar Steel

ArcelorMittal, a multinational steel corporation headquartered in Luxembourg, has become the preferred buyer of Essar Steel's indebted assets in India.

The Creditors Committee (CoC), which was tasked with issuing the authorization, announced that a joint venture between ArcelorMittal and Japan's Nippon Steel and Sumitomo Metal Corp. was selected as the main contender for distressed steel assets. ArcelorMittal will now be in further negotiations with CoC on the final offer price to be announced over the next few weeks. The final application requires 66% of the votes.

Three companies - ArcelorMittal, Vedanta Resources and Numetal participated in the race to the final stage of the bidding process. In accordance with the supreme court ruling, Numetal had to pay INR 49,000 as part of the settlement of Essar Steel's arrears. With Numetal not willing to pay the dues, only ArcelorMittal and Vedanta remained in the race. Incidentally, ArcelorMittal offered Rs 42,000 INR, which beats Numetal with INR 37,000 and Vedanta with INR 35,000.

In addition to the Supreme Court ruling, ArcelorMittal recently approved the payment of INR 7,469 to financial lenders Uttam Galva and KSS Petron as part of the settlement of arrears in order to make the application eligible for COC consideration.

The emergence of the world's largest steel mill in the Indian steel market is expected to intensify competition among private steelworkers in the country. The World Steel Association estimates that Indian steel demand is expected to grow by more than 7.5% in 2018 and another 7.3% in 2019.