Bhushan Steel hits upper circuit as Tata Steel closes deal
Bhushan Steel NSE 4.88 % (BSL) hit upper circuit on Monday as Tata SteelNSE -1.01 %’s wholly-owned subsidiary Bamnipal Steel completes stake acquisition in BSL.
The buying of 72.65 per cent stake is in accordance with approved guidelines under the corporate insolvency resolution process (CIRP).
The scrip was locked in upper circuit of 4.88 per cent at Rs 29 whereas the BSE Sensex was flat with negative bias at 34,839 at around 9.25 am.
Tata Steel traded 0.73 per cent up at Rs 595.80 on early Monday.
“The admitted CIRP cost and employee dues have been paid as required under IBC (Insolvency and Bankruptcy Code). Further, settlement of the amount equivalent to Rs 35,200 crore towards financial creditor of BSL is being undertaken… Rs 1,200 crore will be paid to the operation creditors of the company over 12 months,” Tata Steel said in a release.
The investment from its subsidiary in the insolvent company has been done through a combination of equity of Rs 158.89 crore and inter-corporate loan of Rs 34,973.69 crore. Additionally, Rs 100 crore has been paid by BNPL to the financial creditors of Bhushan Steel.
The steel maker also said the acquisition is being financed through a combination of external bridge loan of Rs 16,500 crore availed by its subsidiary and the balance through investment by it in BNPL.
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