Vedanta Group firm Sesa Goa has secured a stay order from the Delhi High Court against the decision taken by Industrial Financial Corporation of India on Bellary Steel sell-off in which JSW Steel was declared the highest bidder.
"Our dispute is against the process followed by IFCI in the bidding. We have already taken up the matter with the Delhi High Court, which stayed the sale (order) last week," Sesa Goa's Managing Director P K Mukherjee told PTI yesterday.
Last month, a consortium of lenders led by IFCI had declared JSW Steel as the highest bidder for acquiring the assets of Bellary Steel and Alloys (BSAL), where Sesa Goa was the only other qualified contender.
"Our dispute is with the process... We were the only qualified bidder initially and declared successful bidder verbally. Our people were told to come after lunch to collect the allotment letter.
When we came back after lunch, we were told that there is another bidder and that bid is only marginally higher than our price," Mukherjee said.
While Sesa Goa's bid was at Rs 206 crore, slightly more than the reserve price of Rs 205.63 crore, JSW quoted Rs 210 crore for the assets of Karnataka-based company.
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"The stay order came after we filed a petition and next hearing will be in mid-February," Mukherjee said, while clarifying that Sesa Goa does not have any issues against JSW Steel.
"We have no problems with JSW at all... Our dispute is with the process, which IFCI followed," Mukherjee said.
According to the Delhi High Court website, next hearing has been scheduled on February 22 on the matter.
Headquartered in Bangalore, Bellary Steel and Alloys (BSAL) was promoted by S Madhav and S Parvathi, both from the South, according to its website.
The company had embarked upon setting up an integrated steel plant, with five lakh tonnes per annum capacity and a provision of taking it to 2 million tonnes, at Bellary -- the place in Karnataka where JSW has its 7.8 mtpa plant.
However, BSAL, whose biggest asset is 700 acres of freehold land, could not complete the project and ran into debt.
Thereafter, lenders consortium led by IFCI decided to go for sale of the company assets.
"Bellary Steel is one such asset which is having land at its disposal and it has got all the approvals for 0.5 million tonne capacity. It will be a good opportunity for us to step in as we are already present in Karnataka through our mining operations," Mukherjee said.
According to the tender document, inter-se bidding was to be conducted among the eligible bidders and highest bidder was to be declared successful. However, IFCI officials could not be reached for their comments.