ArcelorMittal's bid to buy Essar Steel opposed

GPI Textiles, a company which is already facing insolvency proceedings, has moved the National Company Law Tribunal (NCLT), Ahmedabad, against the approval of the resolution plan proposed by ArcelorMittal India Private Limited for taking over Essar Steel.

The plan has been reportedly approved by Essar's committee of creditors.

It is submitted by the counsel for GPI Textiles, Vishal Dave, that Pramod Mittal, brother of steel magnate LN Mittal, is a promoter of GPI Textiles. Therefore, LN Mittal should be disqualified from proposing any resolution plan as per the provisions of the Insolvency and Bankruptcy Code."Since the plan has been reportedly approved by the committee of creditors of Essar, the same shall be put up before NCLT for its approval. Therefore, we have moved a caveat in NCLT to ensure that GPI Textiles is heard before such a resolution plan of ArcelorMittal is approved," he said.

The lenders of GPI Textiles, especially Phoenix ARC Pvt Ltd and the State Bank of India (SAM Branch of Chandigarh), claim that ArcelorMittal has to pay the dues as the promoters of the company are related parties.