Electrosteel Steel gets nod for Rs 6181 crore CDR package

Kolkata: Electrosteel Steel, part of Electrosteel Castings, a leading producer of ductile iron pipes used for water transportation, has received a nod from the Corporate Debt Restructuring (CDR) cell for its proposed Rs 6,181 crore CDR package.

Recently the Corporate Debt Restructuring Cell of RBI has approved the CDR package of ESL. ESL, which has set up a 2.5 million tonne per annum integrated steel plant in Jharkhand at a project cost of Rs 11,000 crore, had approached bankers for corporate debt restructuring recently.

Incidentally, the company has already invested nearly Rs10, 000 crore in the project.

"While an overwhelming majority of participating banks have confirmed their mandates to the CDR package, there are few banks that are still to come on board. It is expected that seeing the large support from the lead bank and the other banks, the remaining banks that are also likely to provide their confirmation to the CDR proposal," the company said in a statement issued on Monday.

"The banks are also expected to clear the working capital proposal pending with them. This would also be in line with the RBI Circular on the matter," the ESL statement added.

Commenting on the development, Ashutosh Agarwal, executive director (finance) expressed his special appreciation for the initiative in the matter taken by Anil Swarup additional secretary in the Cabinet Secretariat, Govt. of India, who also heads the sub group of Cabinet Committee of Investment (CCI), for the success of the CDR package.

In January, 2013 a high powered Cabinet Committee on Investment (CCI) was formed at the initiative of the Prime Minister with the objective of fast tracking large projects with an investment of Rs 1,000 crore and above. In the case of Electrosteel Steels Ltd. (ESL) the CCI has proved to be a major catalyst.

Addressing a meeting of bankers in Kolkata in July 2013, Finance minister P. Chidambaram had impressed upon the bankers to clear the pending issues of large projects especially where substantial investments have been made by the promoters and the bankers. Subsequent follow up by Mr Anil Swarup, has taken forward successfully many projects which were facing various hurdles including loan disbursements from banks.