ArcelorMittal eyes Essar port, plant; GIC, Mitsubishi vie for GMR Airports stake

By Keshav Sunkara

  • 20 Feb 2019
ArcelorMittal eyes Essar port, plant; GIC, Mitsubishi vie for GMR Airports stake
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Essar Group held talks with ArcelorMittal over the sale of its port and power plant at Hazira in Gujarat, The Economic Times reported.

Citing people aware of the development, the report said Essar is expecting Rs 8,500-10,000 crore from the sale.

Hazira port has capacity of 30 million tonnes per annum and the natural gas-fired power plant has a capacity of 515 megawatts, according to the report.    


The port and power plant are critical for the smooth operation of Essar Steel plant in Hazira.

In October last year, Essar Steel lenders approved a joint offer by ArcelorMittal and Nippon Steel.

Essar Steel plant, located at Hazira, has a capacity of 10 million tonnes per year. The firm has iron-ore pellet facilities in Visakhapatnam and Paradip having total capacity of 14 million tonnes per year.


Last month, the National Company Law Tribunal had rejected a loan settlement offer by Essar Steel's promoters.

The promoters offered to pay Rs 54,390 crore to the lenders for regaining control of Essar Steel.

Separately, ArcelorMittal had submitted a bid to acquire Essar’s 1,200-megawatt Mahan power plant in Madhya Pradesh for Rs 4,800 crore ($673 million). It had also bid for Essar’s infrastructure arm EPC Constructions.


In another development, Singapore’s sovereign wealth fund, GIC, and Japanese conglomerate Mitsubishi Corp are in fray for a minority stake in GMR Infrastructure Ltd’s GMR Airports, The Economic Times reported.

Citing three people aware of the development, the report said GMR is looking to raise Rs 4,000-5,000 crore through stake sale in the airport business. GMR will use the funds from the stake sale to pare debt.

Last week, GMR said in a stock-exchange filing that it had formed a sub-committee of its board to look into the possibility of spinning off its airport business.


The company also said it has received multiple proposals from investors for its airport business and that the sub-committee will evaluate those proposals.

GMR operates airports in New Delhi, Hyderabad and Cebu in the Philippines. It is also developing new airports at Mopa in Goa and at Heraklion in Greece. Recently, GMR emerged as the highest bidder for the privatisation of Nagpur airport.

Separately, The Economic Times reported on Tuesday that Canadian pension fund PSP Investments, Spanish infrastructure company Ferrovial and sovereign wealth fund Abu Dhabi Investment Authority have placed final bids to pick up a stake in GVK Airport Holdings Pvt. Ltd, a wholly owned unit of GVK Power and Infrastructure Ltd.


In another development, state-run lender Andhra Bank is looking to sell either entire or part of its 30% stake in IndiaFirst Life Insurance Company Ltd to raise Rs 900 crore, The Economic Times reported.

Citing a person aware of the development, the report said private equity giant Warburg Pincus is in the fray to buy the stake.

In June last year, Warburg Pincus had acquired a 26% stake in IndiaFirst Life Insurance from Legal & General Group Plc. for Rs 710 crore ($105 million. The deal valued Mumbai-headquartered IndiaFirst Life at Rs 2,733 crore.

Warburg Pincus can buy only 23% stake more as the foreign direct investment cap on insurance is 49%.

Bank of Baroda holds 44% stake in IndiaFirst Life Insurance.

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