Essar Steel to raise $500 million

Essar Steel to raise $500 million

Indian steelmaker Essar Steel Ltd. will raise $500 million through a convertible instrument to fund its acquisition program in Hy-Grade Pellets Ltd and Steel Corporation of Gujarat Ltd. Essar Steel has already 49% stake in Hy-Grade Pellets Ltd while the remaining 51% is held by Stemcor Ltd and Steel Corporation of Gujarat Ltd is also promoted by UK-based Stemcor Ltd. The Vizag-based Hy-Grade Pellets produces 4 million tons of iron pellets and is planning to increase its capacity to 7 million tons. The company is also setting up a pipeline to carry iron ore from Bailadila to Vizag. Meanwhile, the Hazira-based Steel Corporation of Gujarat Ltd has partially commissioned its 1.2 million tons of capacity of cold rolling and galvanizing plant.