Russia’s Rosneft acquires Essar Oil
Q. Russia’s Rosneft Oil Company and its partners on 15th Oct 2016 acquired India’s second biggest private oil firm. Which corporate group does the unit belong to?- Published on 18 Oct 16a. Reliance
b. Essar
c. Shell
d. None of the above
ANSWER: Essar
Russia’s Rosneft Oil Company along with its partners on 15th Oct 2016 acquired India’s second biggest private oil firm Essar Oil in an all cash deal valued at USD 13 billion
- Rosneft’s partners include Rosneft Oil Company, United Capital Partners and Trafigura
- The acquisition was announced during the 8th BRICS Summit in Goa
- Rosneft will have a 49 percent stake in the refinery, port and petrol pumps of Essar Oil
- The remaining partners will split the 49 percent equity equally
- Remaining 2 percent will be held by minority shareholders after the delisting of Essar Oil
- Deal includes USD 10.9 billion for Essar’s Vadinar refinery and USD 2 billion for the port terminal that feeds the refinery
- It also includes Essar Oil’s debt of USD 4.5 billion and USD 2 billion debt with the port company and power plant
- Rosneft now becomes the third international player after after Royal Dutch and Shell and British Petroleum to enter the Indian fuel retailing market
- Essar Oil a subsidiary of Essar Group is a fully integrated oil & gas company and is among the largest single site refineries in Vainer, Gujarat with the capacity of 20 MT
- Essar Oil has a portfolio of offshore and onshore oil and gas blocks with around 1.7 billion barrels of oil equivalent in reserves and resources
- The company was established in 1969
- Essar Group is led by Shashi Ruia and Ravi Ruia
