Essar Steel creditors' panel chooses ArcelorMittal's joint bid: CNBC TV18

The committee of creditors of debt-laden Essar Steel India Ltd has chosen the resolution plan by ArcelorMittal SA and Japan`s Nippon Steel & Sumitomo Metal Corp as the winner, CNBC TV18 reported on Friday, citing sources.

The steelmaker has signed the letter of intent to buy Essar Steel for 420 billion rupees ($5.74 billion), CNBC TV18 said.

The news comes just a day after Essar Steel said its board and shareholders offered to pay 543.89 billion rupees ($7.43 billion) to creditors to settle their claims, allowing the company to exit a bankruptcy process.

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Essar Steel, owned by the billionaire Ruia brothers, is one of a group of companies that are among India`s biggest debt defaulters that were dragged into the bankruptcy court last year. The moved was after a central bank order that was aimed at clearing record bad loans at the country`s banks.

ArcelorMittal, the world`s biggest steelmaker, has been asked to notify the London Stock Exchange before it opens on Friday, CNBC TV18 reported https://twitter.com/CNBCTV18Live. ArcelorMittal and Essar Steel did not immediately respond to a request for comment from Reuters. 
($1 = 73.2200 Indian rupees)