Just a day ahead of the Supreme Court-imposed deadline kicking in, ArcelorMittal sweetened its bid for Essar Steel. Its board approved a payment of ₹7,469 crore to clear the loan defaults of Uttam Galva and KSS Petron, in which it had held substantial stakes earlier.

In its letter to Essar Steel’s Committee of Creditors (CoC) on October 11, ArcelorMittal had pegged the outstanding dues of the two companies at ₹4,554 crore. This was lower than the ₹7,000 crore it had set aside earlier.

Though ArcelorMittal sold its stake in Uttam Galva and KSS Petron to make itself eligible to bid for Essar Steel, the Supreme Court, in its ruling on October 4, said it had to clear the dues of both the companies by October 18. On Wednesday, ArcelorMittal said its board has approved a payment of ₹7,469 crore to the financial creditors of Uttam Galva and KSS Petron so that Essar Steel’s CoC can consider its offer.

Given the significant benefits that Essar Steel would bring, the payment is an appropriate course of action under the circumstances, it added.

Asked how ArcelorMittal, a listed entity, can settle the dues of KSS Petron, in which the former’s promoter Lakshmi Mittal had a personal holding, an ArcelorMittal spokesperson said these were never the personal liabilities of Lakshmi Mittal.

The Mittal family was never identified as a promoter of KSS Petron or its parent KSS, but the Supreme Court ruled that ArcelorMittal must pay KSS Petron’s debts in order to be eligible for the Essar Steel bidding.

Mittal, in his personal capacity, held a 33 per cent stake in KazStroyService (KSS), an Kazakhstan-based oil infrastructure provider. KSS owns 100 per cent of KSS Petron, which availed a loan from SBI and defaulted in 2015.

“Without paying Uttam and Petron dues, our offer for Essar Steel would not be considered,” said the spokesperson.

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