Supreme Court clears path for ArcelorMittal to acquire Essar Steel

TheSupremeCourtcleared thepathon Friday forsteelmakerArcelorMittalSA to take over bankruptEssarSteel, following a legal tussle that has dragged through multiplecourts for over two years.

The apexcourtsaid operational creditors cannot be treated on par with financial creditors of a bankrupt company, in a ruling that provides relief to lenders and sets a precedent that could speed-up the resolution of other insolvency cases.

Banks had moved theSupremeCourtearlier this year after an appellatecourtjudge put the claims ofEssar's operational creditors on par with those of its lenders.

EssarSteel, with debts from banks worth nearly 500 billion rupees ($7.01 billion), was among the so-called dirty dozen - twelve largesteeland other infrastructure companies which defaulted and were referred to India's bankruptcycourtin 2017.