Essar Shipping Ports gets HC nod for de-merger scheme

The Gujarat High Court has approved a scheme of arrangement of de-merger of shipping, logistics and oil fields services businesses of Essar Shipping Ports & Logistics Ltd (ESPLL), the company informed on Thursday.

The de-merger will create two separate entities namely, Essar Ports Ltd (existing ESPLL) and Essar Shipping Ltd (the resulting company). Both the companies would be listed on the NSE and BSE, a company statement said.

The scheme also includes merger of two wholly owned investment subsidiaries into ESPLL. The scheme of arrangement will become effective upon completion of certain statutory formalities.

Rajiv Agarwal, CEO and managing director, ESPLL said, "Both companies have attained a critical mass and need focused management, with substantial growth plans lined up. This demerger will help them follow their independent growth trajectories.”

In its meeting held on August 12, 2010, the ESPLL Board had unanimously passed a resolution to demerge its shipping, logistics & oil fields businesses into a separate entity.

In addition, the Board has also approved a proposal for amalgamation of two of its wholly owned investment subsidiaries into ESPLL, for simplification of the holding structure.