Alternative Investment

Payaash Capital challenges ArcelorMittal’s bid for Srei

Payaash Capital (Singapore) Pte, the JV partner with Srei Infrastructure Finance for Trinity Alternative Investment Managers Ltd (TAIML), has challenged the inclusion of ArcelorMittal in the bidding process to acquire Srei Group assets under the insolvency process.

The company has alleged ArcelorMittal’s ineligibility in the bidding process due to pending litigations over dues owed to Trinity Alternative Investment from the takeover of Odisha Slurry Pipeline by ArcelorMittal.

Accusing the company of mismanagement and oppression, Payaash Capital in a letter to the Srei administrator, alleged collusion with ArcelorMittal — which in turn has asked Trinity Alternative Investment to withdraw all litigations filed against it.

“TAIML protects the various investments made by various investors in different funds, and by doing so, TAIML has a fiduciary duty towards the investors to protect and maximise their investments,” it said in the letter accessed by businessline.

Payaash Capital, as a minority shareholder, however, doesn’t have any locus standi to interfere in the Srei insolvency process — which is being monitored by the NCLT and RBI, said a source.

Beef with ArcelorMittal

Trinity Alternative Investment has filed claims of ₹10,000 crore against ArcelorMittal, with Payaash Capital saying that the inclusion of the latter in the Srei insolvency process will hinder TAIML’s recovery and give ArcelorMittal access to confidential documents and data pertaining to the litigation.

ArcelorMittal acquired Odisha Slurry through its takeover of Essar Steel in 2019. TAIML managed Srei Multiple Asset Investment Trust, which in turn held 70 per cent stake in Odisha Slurry through India Growth Opportunities Fund.

Resolution process

In its letter, Payaash Capital also brought up the issue of “unacceptable and hasty manner in which the existing independent directors” of TAIML were removed at the extraordinary general meeting held in July.

“On one hand, you are trying to illegally take complete control of the board of TAIML, and on the other, you are allowing ArcelorMittal through you to disrupt and hinder the ongoing debt recovery proceedings,” it said.

The issue with respect to the directors also does not stand as Srei despite being the majority shareholder had no representation on the board of TAIML — something that Srei has been trying to rectify, the source said.

Payaash Capital has been refusing to co-operate with Srei Infrastructure Finance in terms of furnishing financial information, window dressing of funds and operational transparency, which is why Srei was keen to have its directors on the board, sources said.

The CoC (committee of creditors) for the Srei companies has so far received five initial bids from Shon Randhawa and Rajesh Shah, consortium of Varde partners and Arena Investors, Capri Global, ArcelorMittal-promoted AM Mining India, and Edelweiss ARC.

The last date for submission of the final bids is November 25, and for completion of the resolution process is January 5.

Source link

Leave a Comment