Rosneft, Trafigura and UCP set to announce Essar deal

The Essar deal is expected to be announced on Saturday in Goa during a visit by Russian President Vladimir Putin, who will meet Indian Prime Minister Narendra Modi for a bilateral summit


One of the persons familiar with matter said that the deal will be funded by Russia’s VTB Capital, part of state-controlled bank VTB. Photo:
One of the persons familiar with matter said that the deal will be funded by Russia’s VTB Capital, part of state-controlled bank VTB. Photo:

New Delhi: Russian oil major Rosneft, along with European trader Trafigura and Russian fund United Capital Partners, will acquire 98% in India’s Essar Oil for about $12-$13 billion including debt, two people familiar with the deal told Reuters on Thursday.

Rosneft will get 49% and the two investors—Trafigura and UCP—will hold the remaining 49% in equal parts, people familiar with the matter said, adding that the valuation included about $4.5 billion in assumed debt. Essar Oil operates a 400,000 barrel-per-day oil refinery on India’s west coast and sells fuels through its 2,470 filling stations in India.

The company is part of a steel-to-ports conglomerate controlled by the billionaire Ruia brothers that has faced pressure from creditors to reduce borrowing that some analysts estimate at more than $14 billion.

One of the persons familiar with the matter said that the deal will be funded by Russia’s VTB Capital, part of state-controlled bank VTB.

The Indian firm is expected to announce the deal on Saturday in Goa during a visit by Russian President Vladimir Putin, who will meet Indian Prime Minister Narendra Modi for a bilateral summit.

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