A consortium of bankers approved the resolution plan submitted by Royale Partners to acquire Essar Group’s EPC Constructions, preferring the Mauritius investment fund over steel giant ArcelorMittal.

Up to 73 percent of the lenders voted in favour of the resolution plan by Royale Partners, said sources familiar with the matter, asking not to be named.

Royale Partners, owned by Dubai- headquartered RPMG Investment, offered Rs 420 crore as upfront cash payment to the lenders, led by IDBI Bank and Rs 480 crore as non-convertible debentures.

In the earlier round, bankers rejected the sole bid received from ArcelorMittal, the world's largest steel maker, as the amount it quoted was too low and involved a recovery of under ten percent, said the sources, adding that this led to the committee of creditors led by IDBI Bank to invite a second round of bids.

ArcelorMittal's overall offer for the company stands at more than Rs 2,000 crore. Thus includes Rs 402 crore as upfront cash payment to lenders and over Rs 1,000 crore equity infusion into the company.

EPC Constructions has a debt of over Rs 7,200 crore to the IDBI Bank-led consortium.

First Published:Jan 10, 2019 10:33 PM IST