NEW DELHI: Steel giant ArcelorMittal, locked in a battle to acquire Essar Steel, on Thursday sought the disqualification of Russia's VTB Capital-backed NuMetal Ltd, alleging that the firm was acting in concert with promoters of Essar group. However, the tribunal hearing the case did not agree to its contention.
At a hearing before a two-member bench of the National Company Law Appellate Tribunal (NCLAT), senior lawyer Abhishek Manu Singhvi, appearing for ArcelorMittal, said "NuMetal and Rewant Ruia are alter ego of each other. They both are the same", going on to allege that the two were acting in concert with each other.
According to the petitioner, when first bids for loan defaulter Essar Steel were called in February, Rewant owned 25 per cent in Mauritius-based investment vehicle NuMetal. While the NCLAT bench posed several probing questions, including whether a company can be considered to be an alter-ego of its shareholder - especially when such minority shareholder is neither in management or control of the company (NuMetal), it observed that question of disqualification of NuMetal on the ground that one of its minority shareholders is related to promoters of Essar requires substantiation based on law.
The NCLAT also observed that allegations of NuMetal acting in concert with the promoters of ESIL cannot be based on general analysis and needs be substantiated with legal grounds in accordance with law. The NCLAT is hearing cross-petitions filed by NuMetal and ArcelorMittal challenging each other's eligibility to bid for Essar Steel which is being auctioned after the company defaulted on payment of Rs 51,800 crore loans to lenders.