Essar Shipping (ESL), in line with the approval granted by the Shareholders, has monetized its fleet of vessels. The proceeds of the vessels are being utilized to reduce the debt to its secured lenders. As the Baltic Dry Index hit a 10 year high in 2021, making it the most appropriate time in order to reduce its debt. With this monetization and upon satisfaction of other conditions, the company’s obligation to its lenders will reduce by approximately Rs 1,100 crore.
The Baltic Dry Index hit its decade high of 5,650 points in October 2021. Accordingly, it was felt that this was an appropriate time for Essar Shipping to monetize its vessels and fetch the best price in order to maximise valuation and reduce debt accordingly. With ESL achieving its task of monetization of assets to reduce its liabilities, the company is now looking at appropriate opportunities for a future business built up. The company’s experience of 40+ years in marine transportation and logistics will be a pillar of strength to chalk out future business strategy.
Essar Shipping is an integrated supply chain solution provider with investments in sea transportation and contract drilling services.
