Business Standard reported that JSW Steel has offered to make the upfront payment to lenders of Bhushan Power & Steel Limited to close more than a three-year corporate insolvency resolution process. Additionally, the offer is being upped by INR 400 crore to sweeten the deal. Lenders are yet to accept the proposal. BS Report quoted a source as saying that “The proposal was made last week and the payment will be made subject to a bank guarantee or indemnity bond from lenders, so that in case the Supreme Court invalidates JSW’s resolution plan, the settlement amount will be reversed.”
JSW Steel’s upfront payment to financial creditors was INR 19,350 crore; with this additional INR 400 crore, it would stand enhanced at INR 19,750 crore; admitted claims of financial creditors is INR 47,158 crore.
JSW’s readiness to pay is a change from an earlier stance. In June, after the Covid-19 pandemic, it had sought flexibility in payment schedule for its bid, but lenders had rejected the demand. Between then and now, however, the fortunes of the Indian steel industry have changed. The closure of BPSL would add about 3 million tonnes capacity to JSW Steel’s existing 18 million tonnes.