In the recent instance of selling distressed units, Monnet Ispat is up for grabs. A consortium led by State Bank of India (SBI), sources said, has taken over the debt-ridden company and is looking for a buyer as part of the strategic debt restructuring. The lenders have already invited bids; however, the response isn’t too enthusiastic. JSW, which is on an acquiring spree to fulfill its expansion plans, is the only buyer who has expressed a keen interest.
Meanwhile, the government is mulling over the possibility of SAIL maintaining & operating the sick unit until a buyer is finalized. Sources said, while SAIL could carry out operation and maintenance of Monnet, the PSU is not looking to buy the unit.
Since buying interest in the steel plant is fairly low, with only one bid from JSW, the lenders are exploring various options. In this regard, they approached the steel ministry and sought to determine SAIL’s interest in taking Monnet if bank took all the equity.
But an unnamed official said that SAIL will not bid for the unit, although, it may operate & maintain.
Monnet Ispat has a de-risked business portfolio that encompasses manufacturing and marketing of sponge iron, steel and ferro alloys. The company is also engaged in mining of minerals like coal and iron ore.
Monnet Ispat, a debt-ridden steel plant inviting bidders is one of the many recent examples of the Indian steel industry taking the route of M&A to de-stress and cut losses. India is pegged to be one of the top-most active South-East Asian countries towards mergers and acquisitions in the coming year. Even as M&A gains a foothold in the Indian steel sector, it is best to be opted after due consideration to its procedure and expert advice.
To get first hand info on all about M&A, recent activities, facts, figures, updates and to listen to industry experts, take note of M&A Conference & Investors Meet – Steel, Power and Cement to be organized by SteelMint Events on 12th April in Mumbai. For more details visit http://events.steelmintgroup.com/