By Our Correspondent
BHUBANESWAR/CUTTACK: Call it B Prabhakaran, the powerful mining contractor got a shock and Tamil Nadu’s Salem born, mining giant , lost a grim battle to Laxmi Mittal of ArcelorMittal Group.
The ArcelorMittal has completed the acquisition of Odisha Slurry Pipeline Infrastructure Ltd for a net consideration of INR 1,860 crore, filling a much needed gap in its supply chain logistics to procure iron ore for AMNS India, media reports said.
OSPIL owns and operates a 253-km pipeline that connects iron ore mines in Dabuna, Odisha, to a pelletisation plant in Paradip. It connects ArcelorMittal Nippon Steel India (formerly Essar Steel) iron ore beneficiation plant in Dabuna to its pellet plant in Paradip in Odisha.
The company acted on an NCLT Cuttack order of March 2 and paid off the creditors, led by IDBI, earlier this month. It also inducted three directors on the board of OSPIL. The pipeline is a key infrastructure to ferry ore from the mine heads inside Odisha to the Paradip port without depending on road or rail network. The ore is then converted to pellets, loaded in ships and taken to Hazira in Gujarat
However, Calcutta-based NBFC Srei Infrastructure Finance Ltd, a fund sponsored by Srei and which held a 69.81 per cent stake in OSPIL, continues to dispute the transaction. SIFL, which had also lent INR 321 crore to the pipeline, did not accept the fund transferred by ArcelorMittal as part of the resolution plan and kept the amount in an escrow account. It had challenged the NCLT order at the appellate tribunal in Delhi soon after the March order but hearing on the matter was delayed because of the lockdown and other restrictions.
The Resolution Professional of OSPIL had shortlisted two resolution plans by — ArcelorMittal India and Thriveni Earthmovers Pvt Ltd. However, the Committee of Creditors opted in favour of ArcelorMittal India with 100 per cent voting.
Thriveni Earthmovers had challenged its rejection before the NCLT but it withdrew its plea on February 24, 2020.The NCLT has on May 14, 2019 had directed to initiate corporate insolvency resolution process against OSPIL
ArcelorMittal India Private Limited (AMIPL), the holding company of ArcelorMittal had also commenced mining operations at Thakurani iron ore mine. The block, with estimated reserves of around 179 MT, will make a valuable contribution to AM/NS India”s long-term raw material requirements.
Thakurani block has an estimated reserves of around 179 million tonne (MT) and will meet up to 75 per cent of current requirement of ArcelorMittal Nippon Steel India (AMNS India) for its manufacturing facilities in Odisha. The block has an annual production capacity of 5.5 MT, which can be scaled up to 8 million tonne and its mineral reserves are expected to increase once detailed exploration is complete.ArcelorMittal Nippon Steel India (AMNS India) owns a 6 million tonne per annum pellet (MTPA) plant in Paradip in the state.
