ArcelorMittal Nippon to buy Essar's ports, power assets for Rs 19,000 crore

In a strategic conclusion to one of India’s top stressed-assets deals between the insolvent Essar Steel and steelmakers ArcelorMittal and Nippon Steel Corporation, the joint venture of the latter two in India agreed on Friday to buy a significant portion of Essar Group’s power, ports, logistics and infrastructure assets in India for about Rs19,000 crore.

The assets involved are strategically important for ArcelorMittal Nippon Steel India, the joint venture formed by the global steel giants after their 2019 acquisition of Essar Steel. The acquisition will be funded solely by the joint venture.

The assets acquired will primarily be captive to ArcelorMittal Nippon’s steel plant at Hazira, Gujarat, while the ports in Andhra Pradesh and Odisha will be allied to ArcelorMittal Nippon's steel operations in India and globally. The power assets will ensure the joint venture’s plants have a secure source of long-term power.

The deal also envisages the setting up of another equal joint venture between ArcelorMittal and Nippon Steel to build a liquefied natural gas terminal at Hazira with a capacity of 4 million tonnes per annum.

The LN Mittal-led ArcelorMittal had acquired Essar Steel for Rs42,000 crore in 2019 under the insolvency and bankruptcy code. The company then formed a joint venture with Nippon Steel Corp to own and operate the Essar Steel assets. See Money

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Published on: Friday, August 26, 2022, 05:44 PM IST