Under pressure from lenders, Essar Steel has appointed ICICI Securities & SBI Capital Markets as advisors to help identify and induct strategic investors into the company.
This decision is in addition to the previously announced plans to monetise certain non-core assets to raise equity and infuse additional funds to enhance operations to full capacity.
Earlier, Essar Steel had revealed a financial plan to sell two of its non-core assets to improve its liquidity, reduce debt and focus on core business area.
According to the proposed plan, Essar Steel plans to hive off Hazira Coke Oven plant having a production capacity of 1.53 million tonnes per annum. The second one relates to 8 million tonnes per annum 267-km Visakhapatnam Slurry Pipeline (between Kiradul and Visakhapatnam)
“The global steel industry is facing major headwinds due to falling steel prices and increased exports from China. The effects of these are already being seen in North America, Canada and Europe. Major steel companies across the world are taking suitable steps to cut costs and raise money,” the company said in a statement.
“India is no different and it is important that measures are taken now to maintain the long-term health of the steel industry. It is in this context that Essar Steel has taken a proactive decision to induct strategic / financial investors into the company,” it added.