Essar Group and Arcelor Mittal Nippon Steel India (AM/NS) agreed on Friday to sell some of its ports, electricity, and transmission assets for nearly $2.4 billion (or roughly Rs. 19,000 crores). A 4 mtpa liquefied natural gas (LNG) terminal would be built at Hazira in Gujarat as part of a joint venture between the two organisations, which was also agreed upon.

The purchase covers assets in Gujarat, Andhra Pradesh, and Odisha, and must receive all necessary corporate and regulatory clearances before concluding.
Essar Steel’s 10 mtpa integrated steel mill in Hazira was purchased by AM/NS through a bankruptcy auction for Rs 42,000 crore after a protracted legal struggle in bankruptcy courts and the Supreme Court. The Hazira assets, which have since been sold, were the focus of a legal dispute earlier. AM/NS maintained that because they were primarily constructed as captive units for the steel mill, their owners should have been transferred along with the steel facility. However, the Hazira plant’s insolvency settlement ultimately excluded these assets.

One of the 12 significant cases accepted for bankruptcy resolution was the Essar Steel case. ArcelorMittal and Nippon Steel, two of the biggest steel firms in the world, have a joint venture called AM/NS.
These assets, which include port assets in Gujarat, Andhra Pradesh, and Odisha, are either captive or related to AM/NS India’s steelmaking, according to a statement from the company. This would improve the strategic integration of its supply chain for manufacturing and transportation. The secure transfer of raw materials and completed goods between AM/NS India’s industrial sites in western, eastern, and southern India, as well as for exports, would be made possible by full control of the strategically positioned port assets in Gujarat, Visakhapatnam, and Paradip. According to the statement, the purchase of the transmission and power assets will guarantee Hazira’s cost-effective, long-term power supply and energy efficiency.