AM/NS India Pays Rs16,500 Crore to Essar Group for 2 Ports, 1 Power Plant
Moneylife Digital Team 21 November 2022
ArcelorMittal Nippon Steel India (AM/NS India) has concluded a transaction to acquire two port assets and a power plant from the Essar group for a net value of about Rs16,500 crore. AM/NS India says it has received requisite corporate and regulatory approvals. 
 
The cash-generating assets are now wholly owned and operated by AM/NS India and are expected to generate operational synergies for the company immediately, says the AM/NS India—a joint venture between ArcelorMittal and Nippon Steel, two of the world's leading steelmakers.
 
This transaction, fully funded by AM/NS India, follows an August 2022 agreement with Essar to acquire several power and infrastructure assets that are either captive or allied to the company's operations and will strengthen the strategic integration of the company's manufacturing and logistics chain, it added.
 
Dilip Oommen, chief executive officer (CEO) of AM/NS India, says, "Owning these strategically located assets also supports our recently announced decision to proceed with a Rs60,000 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."
 
"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 100kms Gandhar - Hazira transmission line—are expected to be completed in due course once necessary regulatory approvals are received," he says. 
 
The assets bought by AM/NS India from Essar group include a 25MTPA (metric tonnes per annum) jetty at Hazira in Gujrat, a 12MTPA deep-water jetty at Paradip in Odisha and a 270MW (megawatt) multi-fuel power plant at Hazira.
 
The company says the 25MTPA jetty at the all-weather, deep draft bulk port terminal at Hazira is captive and adjacent to AM/NS India's flagship steel plant. Similarly, the 12 MTPA deep-water jetty at Paradip, along with a dedicated conveyor, handles 100% of pellet shipments from AM/NS India's Paradip pellet plant. The 270 MW multi-fuel power plant at Hazira has a long-term power purchase agreement with AM/NS India's adjacent steel plant, the company says.
 
In a separate release, Prashant Ruia, director of Essar Capital, says, "Essar has concluded its asset monetisation programme and completed the debt repayment of US$25 billion (about Rs2 lakh crore), effectively making the group debt-free from Indian banks and financial institutions."
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