Essar Group to sell ports, power assets to Arcelor Mittal India for ₹19,000 crore

The deal also envisages a 50-50 joint venture, for building a 4 MTPA LNG terminal at Hazira, Gujarat, between Essar and ArcelorMittal

Mumbai

Essar Group said its entities have signed definitive agreements for divesting port, power and other logistics and infrastructure assets in India to Arcelor Mittal Nippon Steel India (AM/NS) for a net value of $2.4 billion (₹19,000 crore).   

The transaction is expected to be funded only by AM/NS India. The assets are either captive, including port assets in Gujarat, Andhra Pradesh and Odisha, or allied to AM/NS India’s steelmaking and will strengthen the strategic integration of the company’s manufacturing and logistics chain, AM/NS said in a statement.

“Full ownership of the strategically located port assets in Gujarat, Visakhapatnam and Paradip will ensure seamless connectivity and supply chain security for movement of raw materials and finished goods between AM/NS India’s manufacturing facilities in western, eastern and southern India, as well as for exports. Acquisition of the power and transmission assets will ensure cost-effective, long-term power supply and energy efficiency at Hazira,” the company said in a statement.

The deal also envisages a 50-50 joint venture, for building a 4 MTPA LNG terminal at Hazira, Gujarat, between Essar and ArcelorMittal. 

Rewant Ruia, director, Essar Ports & Terminals Ltd., said “With this deal, which yields a multifold return on our investments, Essar Ports & Terminals has unlocked value for all its stakeholders and will continue to focus on building new and modern core infrastructure assets in India and overseas.” 

Prashant Ruia, director, Essar Capital, said “Essar is now repositioned for growth and resurgence. After consolidating our businesses over the last 4 years, we have now entered the next growth phase focused on helping build a sustainable energy future that will impact lives and livelihoods for a greener world.”