According to two persons familiar with the matter, billionaire Anil Agarwal’s Vedanta Ltd is looking to sell ESL Steel Ltd, formerly known as Electrosteel Steels Ltd, after acquiring the company for 5,320 crore through a bankruptcy resolution procedure five years ago.
When the asset was first put up for sale in late December, the transaction fell through because a number of approvals, including environmental clearance and an expansion plan, were still pending and lacked the confidence of potential buyers.
Under the condition of anonymity, the people stated that the bankers’ India offices, including Citigroup and JPMorgan, have the mandate for selling the asset in Bokaro, Jharkhand. They added that the specifics and boundaries of the asset will be known by the middle of August. The mandate may potentially encompass the iron ore mines in Goa and Karnataka.
On the condition of anonymity, the persons stated that the cost of ESL and the iron ore assets would range from $2 billion to $3 billion.
Despite Agarwal’s repeated references to his organisation’s emphasis on non-ferrous metals like copper, zinc, and aluminium, the group entered the ferrous metal market when it made aggressive bids for distressed steel businesses.
Since the ownership changed, ESL has been recovering, with FY23 being its highest production. Additionally, ESL boosted its capacity for hot metal to 1.7 million tonnes, with plans to enhance it to 3 million tonnes by the beginning of FY25.