Essar Ports re-finances its Rs405 crore debt
Essar Ports has refinanced its debt in a subsidiary Essar Bulk Terminal through take out finance scheme of India Infrastructure Finance Company Limited (IIFCL). Essar Ports has availed the take out finance scheme to reduce its interest rate by over two and half per cent on Rs405 crore, which is part of debt taken for building its 30 million tonne capacity bulk terminal at Hazira in Gujarat.
Takeout finance of the infrastructure projects by IIFCL is the government initiative wherein an infrastructure project on commissioning can replace some of its costly domestic rupee debt with finances from IIFCL. This lowers the interest burden on infrastructure projects and facilitates incremental lending to infrastructure sector by freeing up the capital of banks.
The company, which has a total debt of about a billion dollars could explore further availing the benefits of such a scheme for cutting the cost of its infrastructure project, Vadinar Port Terminal, a 12 million tonne all weather deep draft facility which is located in Gujarat.
Shailesh Sawa, director finance, Essar Ports :“As part of our constant endeavour to reduce the cost of debt, we have availed government initiated scheme of take out finance. This will reduce our cost of debt and we will undertake more such initiatives to deliver better returns to our shareholders.”