The companies have held preliminary talks on a potential joint bid for the 1,200-megawatt power plant in the central Indian state of Madhya Pradesh.
Tuesday 28, May 2019
(Bloomberg) --ArcelorMittal is exploring a joint offer with Resurgent Power Ventures to acquire an Essar Power generation plant in India.
Arcelor had previously made a non-binding offer of INR 48 billion ($690 million) for the asset.
Adding Resurgent Power to the bid would help Arcelor, the world’s largest steel producer, gain control of the power plant without putting as much strain on its balance sheet.
Tata Power Company owns 26 per cent of Resurgent Power, while ICICI Bank and the sovereign wealth funds of Oman and Kuwait hold the rest.
Deliberations on the joint offer are still ongoing, and there is no certainty a deal for the power plant will emerge.
The Madhya Pradesh power plant, which supplies electricity to Essar Steel, would boost Arcelor’s attempts to gain a foothold in India. The plant has been in the midst of debt restructuring with INR 75 billion of outstanding loans.