Thursday, Oct 06, 2022
Outlook.com
Business

A Dream Crumbles

Essar's problems were caused by external factors, but also because it tried to grow too fast

A Dream Crumbles
A Dream Crumbles
outlookindia.com
-0001-11-30T00:00:00+05:53

What moths are to fire, the Ruias are to controversy. A sebi inquiry into the Essar Oil public issue, corruption charges in Essar Construction tenders, cheques bouncing on Digvijay Cement and the customs department, accusations of using political connections to profit ESL, suspicions of diverting public funds into personal bank accounts abroad, and now the inability to repay investors against $250 million worth of five-year floating rate notes (frns) that Essar Steel raised and which fell due on July 20. The Ruias had hoped that Indian financial institutions like idbi, uti and lic would bail them out, but at the last moment, the FIs, which already have lent Rs 8,100 crore to the group, pulled the plug.

As a result, the Ruias' supergroup dream lies in shambles. To save ESL, they will have to sell almost everything else they own.

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