Tata Steel top gainer; gains 4% on NCLT approval for Bhushan Steel bid

Tata Steel share price rallied over 4 per cent on Tuesday and was the top Sensex gainer after the National Company Law Tribunal (NCLT) approved steel major's bid for debt-ridden Bhushan Steel. Reacting to the news, the stock gained as much as 4.29 per cent to Rs 636.30. It settled at Rs 624.05, up 2.29 per cent on the BSE. 

The tribunal also dismissed a plea filed by the employees of Bhushan Steel opposing Tata Steel's bid and imposed a fine of Rs 1 lakh. The bench comprising NCLT President Justice M M Kumar and S K Mohapatra also dismissed the plea of engineering and construction major L&T seeking higher priority in recovery of loan and imposed a fine of Rs 1 lakh.

L&T, which is an operational creditor of Bhushan Steel, had sought higher priority in recovery of debt in the resolution process at par with the financial creditors.

The tribunal also rejected Bhushan Energy's plea to continue its power purchase agreement with Bhushan Steel.

The order was pronounced in court today and detailed judgement is awaited.

Earlier on April 11, the principal bench of the tribunal had reserved its order after hearing all the sides.

The Committee of Creditors (CoC) had approved Rs 32,500 crore deal along with 12.27 per cent equity in Bhushan Steel offered by Tata Steel.

However, some employees of Bhushan Steel had challenged it before NCLT contending that Tata Steel was not eligible under section 29 (A) of the Insolvency and Bankruptcy Code (IBC).