Essar Steel’s Committee of Creditors approves ArcelorMittal’s acquisition of Essar Steel
26 Octubre 2018 - 1:49AM
Essar Steel’s Committee of Creditors approves ArcelorMittal’s
acquisition of Essar Steel
Essar Steel’s Committee of Creditors
approves ArcelorMittal’s acquisition of Essar Steel
26 October 2018 – ArcelorMittal (‘the Company’)
announces Essar Steel India Limited’s (‘ESIL’) Committee of
Creditors (‘CoC’) has voted to approve the Company’s acquisition of
ESIL. ESIL’s Resolution Professional, on behalf of the CoC, has
issued the Company with a Letter of Intent (‘LOI’) stating that the
Company has been identified as the ‘Successful Applicant’.
Further to ArcelorMittal being named the H1
Resolution Applicant (the preferred bidder) on 19 October 2018,
ESIL’s CoC has now approved the Company’s Resolution Plan for ESIL,
with the LOI identifying it as the ‘Successful Resolution Plan’.
The Resolution Plan includes an upfront payment of 42,000 crore
rupees (*c. $5.7 billion) towards ESIL’s resolution debt, with a
further 8,000 crore rupees (*c. $1.1 billion) of capital injection
into ESIL to support operational improvement, increase production
levels and deliver enhanced levels of profitability.
ESIL is an integrated flat steel producer, and
the largest steel company in western India. Its current level of
annualised crude steel production is c. 6.5 million tonnes. ESIL
also has iron ore pellet facilities in the east of India, with
current annual capacity of 14 million tonnes per annum.
ArcelorMittal’s Resolution Plan details:
- The Company’s intention to increase ESIL’s finished steel
shipments to 8.5 million tonnes over the medium-term. This will be
achieved by initially completing ongoing capital expenditure
projects and infusing expertise and best practice to deliver
efficiency gains, and then through the commissioning of additional
assets, while simultaneously improving product quality and grades
to realise better margins;
- A long-term aspiration to increase finished steel shipments to
between 12 and 15 million tonnes through the addition of new iron
and steelmaking assets, in order that ESIL can play an active role
and fully benefit from the anticipated growth in the Indian steel
industry.
In-line with ESIL’s corporate insolvency
process, the Company’s Resolution Plan must now be formally
accepted by India’s National Company Law Tribunal (‘NCLT’) before
completion, which is expected before the end of 2018.
After completion, ArcelorMittal will jointly own
and operate ESIL in partnership with Nippon Steel & Sumitomo
Metal Corporation (‘NSSMC’), Japan’s largest steel producer and the
third largest steel producer in the world, in-line with the joint
venture formation agreement signed with NSSMC on 2 March 2018.
ArcelorMittal and NSSMC expect to finance the joint venture through
a combination of partnership equity (one-third) and debt
(two-thirds), and ArcelorMittal anticipates that its investment in
the joint venture will be equity accounted.
*at 73.2 Indian rupees / $1
ENDS
About ArcelorMittal
ArcelorMittal is the world's leading steel and
mining company, with a presence in 60 countries and an industrial
footprint in 18 countries. Guided by a philosophy to produce safe,
sustainable steel, we are the leading supplier of quality steel in
the major global steel markets including automotive, construction,
household appliances and packaging, with world-class research and
development and outstanding distribution networks.
Through our core values of sustainability,
quality and leadership, we operate responsibly with respect to the
health, safety and wellbeing of our employees, contractors and the
communities in which we operate.
For us, steel is the fabric of life, as it is at
the heart of the modern world from railways to cars and washing
machines. We are actively researching and producing steel-based
technologies and solutions that make many of the products and
components people use in their everyday lives more energy
efficient.
We are one of the world’s five largest producers
of iron ore and metallurgical coal. With a geographically
diversified portfolio of iron ore and coal assets, we are
strategically positioned to serve our network of steel plants and
the external global market. While our steel operations are
important customers, our supply to the external market is
increasing as we grow.
In 2017, ArcelorMittal had revenues of $68.7
billion and crude steel production of 93.1 million metric tonnes,
while own iron ore production reached 57.4 million metric
tonnes.
ArcelorMittal is listed on the stock exchanges
of New York (MT), Amsterdam (MT), Paris (MT), Luxembourg (MT) and
on the Spanish stock exchanges of Barcelona, Bilbao, Madrid and
Valencia (MTS). For more information about ArcelorMittal please
visit: http://corporate.arcelormittal.com/
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