Essar concludes $2 bn sale of port, infra assets to ArcelorMittal Nippon Steel

An agreement for this transaction was signed by both the companies in August this year.

“Essar Ports & Terminals Ltd (EPTL) and Essar Power Ltd (EPL) today concluded the US$ 2.05 billion (?16,500 crore) sale of captive ports and power assets located in Hazira and Paradip to ArcelorMittal Nippon Steel India Ltd (AM/NS),” Essar said in a statement.

With this, Essar said, it has completed its asset monetisation programme to effectively become debt free.

“Essar has concluded its asset monetisation programme and completed the debt repayment of $25 billion (Rs 2 lakh crore) effectively making the group debt-free from Indian banks and financial institutions,” said Prashant Ruia, director, Essar Capital.

In a separate release, AM/NS India said these cash generating assets are expected to generate operational synergies for it immediately.

“Owning these strategically located assets also supports our recently announced decision to proceed with a Rs. 60,000 crore capacity expansion plan at Hazira, including the ability for AM/NS India to realise additional synergies from rising throughput at the port assets in both Gujarat and Odisha,” AM/NS India chief executive officer Dilip Oommen said.

Acquisitions of the remaining assets included in the August 2022 agreement – a 515 MW gas based power plant at Hazira, 16 MTPA all-weather, deep draft terminal at Visakhapatnam and the 100 km Gandhar – Hazira transmission line – are expected to be completed in due course once necessary regulatory approvals are received, AM/NS India said.

AM/NS India is a joint venture between ArcelorMittal and Nippon Steel, two of the world’s leading steel manufacturing organisations.

Essar said it continues to have a significant presence and substantial operating assets in all its core verticals – energy, metals & mining, infrastructure & logistics and technology & retail.

The privately held group currently has revenues of around $15 billion (Rs 1.2 lakh crore) and assets under management of close to $8 billion (Rs 64,000 crore) within and outside India.