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It has been a day of development for ArcelorMittal Nippon Steel India which acquired the stressed Essar Steel in a long-drawn insolvency-driven process.
ArcelorMittal on Tuesday received the NCLT Cuttack’s approval for its resolution plan to acquire Odisha Slurry Pipeline Infrastructure, the key infrastructure that connects the company’s iron ore beneficiation plant in Dabuna with the 12 mtpa pellet plant in Paradip.
Last December, lenders had approved ArcelorMittal’s ₹2,350 crore-bid for the 253-km slurry pipeline that transports iron ore.
Deals galore
An ArcelorMittal spokesperson said the company looks forward to completing the formalities that will see ownership of the asset transferred to ArcelorMittal Nippon Steel India.
In another deal, the company has completed the acquisition of Bhander Power Plant in Hazira, Gujarat, from Edelweiss Asset Reconstruction Company.
Bhander, a natural gas-based thermal plant with an installed capacity of 500 MW, will remain captive to the company’s steel manufacturing facility at Hazira.
Set up in 2006, Bhander commenced commercial operations in 2008 and was purchased by the company under the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act. ArcelorMittal Nippon Steel India is a 60:40 joint venture between LN Mittal-owned ArcelorMittal and Japan-based Nippon Steel Corporation.
Earlier this month, ArcelorMittal India was selected the preferred bidder for an iron ore mine licence in Odisha, following an auction process facilitated by the State government. Thakurani block in Keonjhar district has an estimated reserves of 179.26 million tonnes of iron ore and will contribute to the company’s long-term raw material requirements.
After awarding the licence, ArcelorMittal India will proceed to seek requisite clearances, mine development and production agreements, ahead of commencing mining operations.
Dilip Oommen, CEO, ArcelorMittal Nippon Steel India said, the deal is to secure captive power and commodity supply chain as production is being enhanced.
Efforts to become increasingly self-reliant — in this case through the procurement of a key energy source in Gujarat and an iron ore rich reserve in Odisha — form part of the company’s medium-to-long term strategy to increase production capacity in India, he added.
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