On Wednesday, Essar Ports announced a strategic pact with port of Antwerp with an investment of Rs 175 crore in Essar. In an interview with CNBC-TV18, Rajiv Agarwal, CEO & MD, Essar Ports said, "It is an investment of about Rs 175 crore."
Essar Ports announced its fourth quarter results and posted a consolidated net loss of Rs 61.5 crore against profit of Rs 11.5 crore, year-on-year. The company's consolidated total income was up at Rs 288 crore compared to Rs 183 crore in the corresponding quarter last fiscal.
On Wednesday, Essar Ports announced a strategic pact with Port of Antwerp with an investment of Rs 175 crore in Essar. In an interview with CNBC-TV18, Rajiv Agarwal, CEO & MD, Essar Ports said, "It is an investment of about Rs 175 crore through a GDS route at an underlying value of Rs 100 per share, resulting in about 4% equity share in Essar Ports." The money will be utilized for investment in various port entities and paying off debts, informed Agarwal.
The company also hopes to complete work on the Paradip Port by June-July.
Below is the edited transcript of the interview on CNBC-TV18. Also watch the accompanying video.
Q: First I want to ask you about that strategic alliance that you announced. Could you help us with what kind of monetary gains you are hoping to see and by when it could show up in your books?
A: It has been remitted already. I think it will show in our books very quickly. It is an investment of about Rs 175 crore through a GDS route at an underlying value of Rs 100 per share, resulting in about 4% equity share in Essar Ports.
Basically, this alliance is about technical assistance for port planning, development, process improvement, productivity and quality improvement. It will also assist us in increasing port traffic flows from Port of Antwerp to India and vice versa.
Q: Could you just breakup how exactly the Rs 175 crore would be utilized with regards to Essar Ports?
A: This money is coming to Essar Ports which is the holding company of all the ports. Its part of the pool of money which is to be used for investment in various ports entities. We have some loans in the holding company, so this money could go into some reduction of debt in Essar Ports also.
Q: What does the debt figure stand at and how much of it would be pumped in to reduce debt? How much do you think you can pair it down to?
A: The debt is about Rs 500 crore. About Rs 150 crore could be paid to reduce the debt.
Q: Would Antwerp port be looking to raise stake further than this 4% at all?
A: This is the first step. Let's see. In times to come, they may look at it. It all depends on how our partnership works and how we go ahead. At the moment, they felt this was the beginning they would like to make. That's all I can say.
READ MORE ON Essar Ports, Rajiv Agarwal, Essar, ports, Paradip port, Q4, Q4 results, FY12, FY13, Antwerp, Port of Antwerp
Set email alert for
ADS BY GOOGLE
video of the day
Why HSBC MF has a contrarian bet on IT stocks