India’s ArcelorMittal Nippon Steel Limited (AMNS) and Essar Group have signed a definitive agreement for the latter to sell its port and power infrastructure assets to AMNS for $2.4 billion to bolster the captive support facilities of AMNS’ 9 million mt per year steel mill at Hazira, on the coast of the western India state of Gujrat, a statement of Essar Group said on Monday, August 29.
The agreement also envisages a 50:50 joint venture partnership between Essar Group and AMNS to build a 4 million mt capacity liquefied natural gas (LNG) terminal at Hazira, the statement said.
The settlement of infrastructure and logistical assets linked to the steel mill comes almost three years after ArcelorMittal in collaboration with Nippon Steel Japan jointly acquired the steelmaking assets of Essar Steel for an estimated $5.7 billion through the bankruptcy resolution process.
AMNS in a statement said that the transaction was to be funded exclusively by AMNS India.The ownership of port assets had been in courts since 2020 after AMNS applied to the Gujarat High Court shortly after the conclusion of the Essar Steel acquisition in December 2019.
Essar port assets include a 25 million mt per year capacity jetty at the all-weather, deep draft bulk port terminal at Hazira, captive and adjacent to AMNS’ steel mill, a 16 million mt per year all-weather, deep draft terminal at Visakhapatnam, Andhra Pradesh, and a 12 million mt per year deep-water jetty at Paradip port in Odisha.