Indian-born British businessman, Sanjeev Gupta-led GFG Alliance completed the strategic acquisition of Adhunik Metaliks Ltd (Adhunik) and Zion Steel in a Rs 425 crore cash deal, making its entry in the Indian market.

Commenting on the acquisition, Executive Chairman of GFG Alliance, Sanjeev Gupta said, “Today marks an important milestone in our global steel strategy with the purchase of Adhunik Metaliks and our entry into India – one of the fastest-growing and most vibrant steel markets in the world. We see huge potential in this business through the introduction of our GREENSTEEL model to create a competitive, sustainable operation to serve the local market."

Adhunik is an integrated steel plant located at Chadrihariharpur near Rourkela in Odisha with steel making capability using the blast furnace and electric arc furnace and a 34MW captive power plant. Adhunik along with Zion Steel has a combined rolling capacity of 400,000 tonnes per annum. The sites produce products for the automotive, energy, engineering and oil & gas sectors.

GFG Alliance plans to introduce its GREENSTEEL model to revive the steel plants – combining steel recycling with low carbon and renewable power sources – to create a more sustainable, competitive operation serving local markets.

Gupta added, “It has been a challenging journey to get us to this stage, but we now look forward to beginning work in partnership with all stakeholders to revive these plants and bring back employment. On a personal note, it is great to be investing in the country where my family began in the steel industry a generation ago.”

The Adhunik case has seen several twists and turns as the National Company Law Tribunal (NCLT) had ordered liquidation after Liberty failed to implement the resolution plan. The National Company Law Appellate Tribunal (NCLAT), however, stayed the liquidation order on an appeal from Liberty.

Liberty was given time till February 14 to make the payment, which was completed on February 13 and on Monday the appellate tribunal said that formal steps to complete the acquisition could be taken.

Over the past two years, the Liberty group had made many attempts to acquire assets put up for auction under the Insolvency and Bankruptcy Code (IBC) - Bhushan Power and Steel, Amtek Auto and ABG Shipyard were the other assets apart from Adhunik.

Amtek Auto was bagged by Liberty. However, in Amtek, the resolution plan was not implemented and the insolvency process was reopened. Lenders to Amtek have recently voted in favour of a resolution plan submitted by US-based hedge fund Deccan Value Investors LP. Liberty, though, is still fighting a case on grounds of an inflated valuation.

In the case of ABG Shipyard, Liberty was the sole bidder. Its resolution plan was rejected by lenders and it is under liquidation. Both Amtek and ABG were part of the RBI's first list of non-performing assets that were mandated for resolution under the IBC.