Resolution plans for two Uttam Galva companies get nod

MUMBAI: India’s dedicated bankruptcy court Thursday approved resolution plans for Uttam Galva Metallics and Uttam Value Steels, paving the way for their lenders to get back about Rs 2,700 crore — or 37% of the total claims.

Bids were submitted by CarVal Investors and Nithiya Capital Resources Advisors. The resolution plans involve settlement to financial creditors of Uttam Value Steels with a total upfront and contingent payment of Rs 1,078 crore and Rs 1,576 crore for Uttam Metallics.

“The resolution plans filed against the respective companies by the resolution applicants CarVal Investors LLP, New York and Nithiya Capital Resources Advisors LLP…being approved by the respective CoC’s with requisite majority i.e. with 88.9% votes,” read the order by the NCLT.

Lenders to Uttam Galva Metallics had submitted claims worth Rs 4,263 crore, of which Rs 4,176 crore was admitted by the resolution professional. A claim of Rs 3,014 crore was admitted against Uttam Value Steels. The case had been pending in court for more than a year, while in May 2019 CarVal inched closer to acquiring the distressed companies of Uttam Galva after it paid a performance bank guarantee of Rs 500 crore.

Earlier, SBI had said that SSG did not submit satisfactory bids and was being disruptive at this stage by submitting an improved bid after the announcement of CarVal as the sole shortlisted bidder. The bench dismissed the resolution plan submitted by SSG Capital. Operational creditors, Noble Resources and Jatia Group had objected to the plan by CarVal for accepting 99% haircut it proposed.