MUMBAI: Rosneft PJSC and partners including Trafigura Group Pte finalised their $12.9 billion (Dh47.38 billion) purchase of India’s Essar Oil Ltd.
It took more than 10 months to complete the deal after it was announced last October and more than two years after Rosneft first confirmed it was in talks to buy India’s second-largest private oil refiner. The purchase gives Russia’s biggest oil producer and one of the world’s largest commodity traders access to a global demand center in Asia, while helping Essar Group reduce its debt by about $11 billion and shift focus to its struggling steel business.
Essar Group sold 49 per cent of Essar Oil Ltd. each to Rosneft and a consortium of Trafigura and United Capital Partners, the Indian conglomerate said in a statement. The closing of the acquisition enables Rosneft to enter one of the world’s fastest growing markets, the Russian company said in a separate statement.
Essar will sell its refinery at Vadinar on India’s west coast and its fuel-retailing business along with a port terminal and power plant that helps feed the refinery. The deal for the 400,000-barrel-a-day refinery will give Russia’s biggest oil producer an outlet in South Asia for its production as oil-rich countries vie for market share.
Rosneft first confirmed it was buying a stake in the Essar refinery in July 2015. More suitors later entered the fray as Essar was said to be in talks with the national oil companies of Saudi Arabia and Iran to sell a stake in its refinery business. It took several months to secure approvals for the deal as it faced resistance from lenders.
— Bloomberg
