Vedanta Group firm Sesa Goa on Tuesday said it has acquired the assets of the upcoming steel plant of Bellary Steel and Alloys, put on the block by a consortium of lenders led by IFCI for Rs 220 crore.
"We have been looking at setting up value addition facilities, as desired by the state government (Karnataka) and this acquisition provides us with an excellent opportunity to leap frog in that direction," Sesa Goa Managing Director P K Mukherjee said in a statement.
The assets of the acquired company have been transferred on "as is where is" basis to Sesa Goa effective on Tuesday, the statement said, adding Sesa Goa is conducting a detailed assessment to determine the best way forward for commissioning the steel plant at the earliest.
BASL, a Karnataka-based company, had embarked on to set up an integrated 0.5 million tonnes per annum (MTPA) capacity steel plant with provision of taking it to 2 MTPA, at Bellary on 700 acres of freehold land.
However, BASL could not complete the project and ran into debt, following which the lenders consortium led by IFCI put it on the block for sale.
The sell off process was full of drama and a legal battle was also fought by Sesa Goa against the process adopted by IFCI in December, in which JSW Steel was declared winner for its bid of Rs 210 crore for acquiring the asset of BASL.
However, Sesa Goa contended, in its plea before the Delhi High Court in January this year, that IFCI initially announced the Vedanta Group firm as only qualified bidder and declared it winner verbally for its bid of Rs 206 crore.
Following this, the Delhi High Court allowed the Anil Agarwal-owned mining firm to rebid in an inter se bidding process, where the Goa-based company put a successful bid of Rs 220 crore.
Inter se bidding process means the shortlisted companies will have to rebid with their fresh offer.
The acquisition will also pave the way for Sesa Goa to expand its business into the steel sector and would be a strategic fit for the company as the BASL's steel plant is located in the iron ore rich belt of Karnataka.
Shares of Sesa Goa scrips were trading at Rs 262.10 on the BSE in the late afternoon trade, up 1.24 per cent from its previous close.