ArcelorMittal said clause 29A of the Insolvency and Bankruptcy Code (IBC) was delaying the process of acquiring a debt-laden company, Moneycontrol reported.

Lakshmi Mittal, chairman and chief executive officer of ArcelorMittal said the rule in the IBC prevents promoters of defaulting companies from bidding for stressed assets.

It also bars “connected persons” from taking part in the auction.

“I understand why 29A was introduced but it does seem to be creating opportunities for others to delay the process and cause confusion in ways that are perhaps ultimately not helpful in securing strong new owners for the assets in question in a timely manner,” Mittal said to Moneycontrol in an e-mailed interview.

The IBC was created to expedite and cut short the cost in the liquidation process. However, in the bid for India's third largest steelmaker, Essar Steel has missed the deadline.

Also Read: Will be surprised if ArcelorMittal ineligible for Essar Steel bid, says L N Mittal

Mittal has been trying for over a decade to enter the steel manufacturing space in its home ground. Essar Steel, if acquired by the company, will give Mittal an opportunity to enter into India's expanding market.

“At this stage our sole focus is on Essar Steel. We cannot comment on any longer-term plans we may have for the Indian market, other than to say it is an important and strategic market for ArcelorMittal and one where we would like to have a meaningful production presence,” he told Moneycontrol in a report.

ArcelorMittal, world's largest steelmaker is in a race with Numetal to acquire, Rs 45,000 crore debt-laden Essar Steel.

The auction continues to be tangled in protracted legal tussles between Numetal and ArcelorMittal.

First Published:May 7, 2018 12:09 PM IST