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Essar Oil's creditors approve $12.9 billion Rosneft takeover



Creditor banks to India's Essar Oil approved the purchase of the company by a group including Russia's Rosneft, removing a key barrier  to the $12.9 billion deal that has been in the works for two years.



26.Jun.17 2:33 AM
By Daria Zaytseva
Photo Toinnov.com

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Essar Oil's creditors approve $12.9 billion Rosneft takeover
The news comes a day after CEO of the Russian oil and gas giant, Igor Sechin, said the Essar Oil deal could be considered as closed. Rosneft, which considers the redemption as vital to expanding in Asia's fastest growing energy market, had aimed to close the deal at the end of 2016 but it got held up over debt issues.

In May, sources said, those who delaying, Rosneft's biggest foreign purchase, were India's state-run banks and financial institutions that hold about $500 million of Essar's debt.

However, it is still unclear whether India's biggest insurer Life Insurance Corporation (LIC), which also lent money to Essar Oil, had given its approval or not. LIC was not a part of the creditors' group that gave its consent to the deal on Friday, said one of the two sources, who did not want to be named to according to the rules of communication with media.

An LIC spokesman did not answer a call seeking comment. A call made to the Essar Oil CEO also went unanswered.

The deal will give Rosneft a 49 percent share in Essar Oil, while another 49 percent will be divide between Swiss commodities trader Trafigura and Russian fund United Capital Partners. Relatives of the founder of Essar will retain a 2 percent share.



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