In a mailer sent to Union ministers, chief ministers and top bureaucrats, the Essar Group has indicated that it is "poised to embark on a new phase of growth while driving growth in its existing portfolio."
Essar did not specify what the new growth areas could be, but said it is "armed with a substantially lighter balance sheet" after it took "a conscious call of reducing its debt in response to evolving domestic and evolving economic scenario."
The letter was jointly signed by Ravi Ruia and Prashant Ruia.
"In the largest debt reduction exercise in the history of corporate India, we have paid about Rs 140,000 crore ($20 billion) of debt to the banking system over the last 3 years," the promoter Ruia family wrote in the letter.
In a clear affirmation that it had put the past behind, they said: "Our strong portfolio of companies consistently generates healthy and sustainable earnings and have combined revenue of about Rs 1,00,000 crore ($14 billion)."
The group claimed that its ambition to create world-class businesses has not been thwarted by business and regulatory challenges in the mainstream steel and power business.
Essar, the promoters said, had played a vital role in the country's development, with capital investments of over Rs 2 lakh crore in the vital sectors of ports, steel plants, oil refining and fuel retail, oil and gas exploration and production, power generation and transmission, mining, shipping and telecom, with substantial equity contribution.
"We have built some of the finest assets in these sectors, creating thousands of jobs, and contributing several thousand crores of rupees to the Indian exchequer by way of taxes and royalties," they wrote. "A few years ago, we took a conscious call of reducing our debt in response to the evolving global and domestic economic scenario."
Reminiscing the last 50 years of the Essar journey, the Ruias
said the group had to face several business and regulatory challenges along the way in its flagship steel and power businesses, "which particularly impacted us."
"Committed gas supply contracts for the Essar Steel
Complex were withdrawn in 2012 and allotted coal mines for power plants were cancelled in 2014, leading to a partial closure of some of our prime operating assets," they said. "We have dealt decisively and proactively with these challenges and decided that it would be prudent to drastically reduce our borrowings."
These challenges did not stop Essar from creating world-class assets. "The greenfield assets built by Essar have attracted significant Foreign Direct Investment (FDI) of $40 billion, which is reflective of the superior and world-class quality of its assets," the letter said.
Deal to sell Essar Oil to Russia's Rosneft alone saw over Rs 86,000 crore ($13 billion) of FDI, the country's largest until date, it claimed.
On an upbeat note, Essar said it will continue to use its entrepreneurial skills, a vast pool of human resources, and decades of experience and innovation in pursuing fresh opportunities and creating value for all its stakeholders.
Essar currently owns businesses in the core sectors of energy, metals & mining, infrastructure, services and technology.
In the energy sector, Essar has commercial interests in oil, gas and coal bed methane exploration and production in India, Vietnam and Nigeria; oil refining and retailing in UK and power generation in India and Canada.
In infrastructure, Essar operates ports and terminals in India, UK and Africa, and has commercial interests in turnkey project construction in India and the Middle East. In the metals and mining sectors, the Essar Group has exposure to iron ore mining and pelletisation and coal mining in the US and Indonesia.
In new-age services, Essar said it has business interests in digital solutions and customer experience platforms in India, Europe, and US.
"We have fulfilled our Corporate Social Responsibility with focused community uplift programmes in the areas of livelihoods & entrepreneurship, women's empowerment, health, education, infrastructure and environment. The positive impact of these initiatives makes a difference in the lives of 500,000 people from 500 villages across 8 Indian states," the letter added.
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