Essar is ready to raise bid for Esmark

Essar also said that it would consider making an increased bid after it had obtained additional information from Esmark. The offer made by Essar on April 30 was accepted by the Esmark Board, following which the two company had entered into a deal that put Esmark’s enterprise value at $ 1.1 billion.

The deal included a proposed tender offer for a cash purchase price of 17 dollars per share of all outstanding shares of the Nasdaq-listed steel company. However, days after the agreement, Severstal made a matching bid of 17 dollars per share for Esmark, fuelling a bidding war for the US firm.

Simultaneously, at Esmark’s request, Essar also immediately extended a $110 million loan to Esmark, which helped the company address a potential default. As part of the acquisition strategy, Essar has also proposed a capital expenditure program of $525 million for Esmark’s Ohio and West Virginia manufacturing facilities over the next five years.