Essar Shipping to invest Rs 10k cr in next 3 years

Of the total Rs 10,000 crore, ESPLL will use Rs 4,000 crore to acquire 13 vessels and around Rs 1,760 crore to purchase two rigs. ESPLL will invest around Rs 2800 crore for the development of ports, he said.

The company will raise 30 per cent of the total amount through internal accruals and the remaining will be raised from a consortium of banks, including ICICI, SBI, the Hague-based NIBC Bank and the UK-based Halifax.

ESPLL will pay an interest of around 6.5 per cent in dollar denominations for the debt raised from foreign banks, while the loans from India will have an interest of 10.5-11 per cent. The period of the loan is 7-14 years.

At present, the shipping and logistics major gets 35 per cent of its revenues from promoter company Essar Steel, while about 5 per cent comes from Essar Power. Another group company, Essar Oil contributes "substantially" to the company's revenues. The company transports iron ore for Essar Steel, coal for Essar Power and crude oil for Essar Oil and Vadinar Refinery.

The third-party revenues are mainly from the Shanghai-based Baosteel Group (iron ore and refined products transportation), British Petroleum, ENI of Italy, Gujarat State Petroleum Corporation through supply of rigs and other goods.