Will bankrupt a large Indian company
According to media reports in India, the National Tribunal in corporate law will have to decide the fate of three metallurgical companies. We are talking about Electrosteel Steels, Bhushan Steel and Essar Steel. The company in total should banks more than 1 trillion. RS. In dollar terms, this amount will be approximately 15.5 billion USD. The national Tribunal has the authority to make decisions regarding the enterprises having debts in accordance with bankruptcy Law. The next step is the creation of committees that should be addressed by lenders. For 180 days, the committees are developing plans for the restructuring or payment of debts. This period may be extended for 90 days. If this step is not done, the debtor can be liquidated. As for assets, they are sold under the hammer.
In early June, the national reserve Bank has published the list, which included 12 companies. This gave the debtors 14 days to achieve a mutually acceptable compromise with the creditors. To successfully solve the problem was only Monnet Ispat & Energy Ltd. The company plans to declare bankruptcy, followed by restructuring.
As for the other companies, the largest of Essar Steel. In India it occupies fourth place in the development of steel. Its production capacity is over 10 million tons. The level of debt is about 5.8 billion USD. In this case, Essar has almost 21.6 billion USD. The total volume of loans to Bhushan Steel limited achieves 6.9 billion USD. The current situation is largely due to widespread, often a bad investment. You should also consider the production of steel and getting of iron ore in North America. For example, the acquisition of canadian Algoma Steel and Minnesota Iron American over the Declaration of bankruptcy.