High Court to reconsider decision annulling JSW Steel's $2.3 billion Bhushan Power arrangement
The Supreme Court of India has decided to reconsider its order that quashed JSW Steel's $2.3 billion takeover of Bhushan Power and Steel, following a review plea by the steel giant. This move comes six years after the initial approval of the deal and nearly three months after the initial rejection of the takeover by the Supreme Court.
The initial takeover of Bhushan Power and Steel by JSW Steel occurred at an unspecified time in the past. However, the Supreme Court's decision to liquidate Bhushan Power was due to perceived flaws in the takeover process. The liquidation proceedings for Bhushan Power were paused weeks later, and now, the top court has decided to reconsider the case.
The Supreme Court's reconsideration stems from concerns that the earlier judgment did not properly consider established legal precedents and the practical consequences of liquidation. The court highlighted the impact on about 25,000 workers and thousands of crores in investments if the liquidation proceeded, indicating a need to balance legal technicalities with broader social realities.
The justices acknowledged that the purpose of the Insolvency and Bankruptcy Code is to make companies functional rather than put thousands out of work, emphasizing the use of Article 142 of the Constitution to do complete justice. The case has been listed for a full-fledged hearing starting August 7, 2025, where all questions relating to JSW Steel's takeover and resolution plan will be open for argument and re-evaluation by the court.
The Supreme Court's decision may have implications for buyers of other distressed assets in India. In addition, the decision may cast a shadow over Indian bankruptcy reforms introduced in 2016, as it questions the legality of past insolvency resolutions.
On Thursday, the top court heard the review plea from JSW Steel, and it remains to be seen whether the company will be allowed to complete its takeover of Bhushan Power and Steel. The decision may mark a significant development in India's insolvency and bankruptcy landscape, as it could set a precedent for future cases involving distressed assets.
[1] Livemint.com, "Supreme Court to reconsider order quashing JSW Steel's $2.3 billion takeover of Bhushan Power," July 31, 2025. [2] The Hindu BusinessLine, "Supreme Court to hear JSW Steel's review plea on Bhushan Power takeover," August 3, 2025.
[1] The review plea submitted by JSW Steel seeks to readdress concerns about the legality of the original order that quashed its $2.3 billion takeover of Bhushan Power and Steel.[2] The financial implications of this reconsideration extend beyond JSW Steel, possibly affecting future investors in distressed businesses within India's business landscape.
