Essar Steel
Corporate brand
UnclaimedIndian steel-manufacturing brand and group of companies whose principal Indian subsidiary was acquired through insolvency resolution by ArcelorMittal Nippon Steel India Limited.
Last updated August 31, 2026
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Overview
Essar Steel was the common name used for the steel-manufacturing companies associated with Essar Group, with Essar Steel India Limited serving as the principal operating company. Its core business was the production of flat carbon steel through an integrated manufacturing complex at Hazira in Gujarat. The company also operated or developed upstream and supporting assets, including an iron-ore beneficiation facility at Bailadilla in Chhattisgarh and pellet plants at Visakhapatnam in Andhra Pradesh and Paradeep in Odisha. An additional integrated steel project was planned for Paradeep. The business developed from Essar Construction Limited, incorporated on 1 June 1976 as part of Essar Group. Steel activities initially focused on hot-briquetted sponge iron. The corporate entity changed its name to Essar Gujarat Limited in 1987 and later to Essar Steel Limited in 1995. During the 1990s, it expanded into hot-rolled coil manufacturing at Hazira and established a pelletisation plant at Visakhapatnam. It also pursued international and downstream initiatives, including a joint venture in Indonesia for cold-rolled products and a cold-rolling unit established with Stemcor in 2003. In 2007, Essar acquired Canadian steelmaker Algoma Steel, adding an overseas steel operation to the group. The Indian operating company adopted the name Essar Steel India Limited in January 2012. Essar Steel’s growth strategy depended heavily on expansion of the Hazira complex and reliable access to natural gas, a key input for its direct-reduced-iron and steelmaking operations. Delays in environmental approvals and insufficient gas availability impaired the planned expansion and reduced operating efficiency. At the same time, weaker commodity prices and a difficult financing environment put pressure on the company’s liquidity. The company had previously entered corporate debt restructuring in 2002, reportedly with debt of approximately Rs 2,800 crore, but exited that process ahead of schedule in 2006. A more severe financial crisis emerged during the middle of the 2010s. By 2015, financial-creditor claims were reported to exceed Rs 49,000 crore, prompting lenders to examine debt-to-equity conversion and a possible sale of the business. Efforts to find a private restructuring or merger-and-acquisition solution did not produce a successful transaction. After the Reserve Bank of India’s asset-quality review, Essar Steel was among the large stressed accounts directed toward insolvency proceedings under India’s newly implemented Insolvency and Bankruptcy Code. The National Company Law Tribunal admitted the company to insolvency on 2 August 2017. ArcelorMittal and Numetal submitted initial resolution plans, but both were initially deemed ineligible under Section 29A. Following litigation before the NCLT, NCLAT and Supreme Court, the bidders were permitted to address specified historical dues and resubmit plans. ArcelorMittal subsequently cleared approximately Rs 7,500 crore in dues associated with Uttam Galva and KSS Petron, allowing it to participate in the renewed process. The creditors’ committee selected ArcelorMittal’s plan over Vedanta’s proposal. The NCLT approved the resolution plan in March 2019, NCLAT approved it with modifications in July 2019, and the Supreme Court confirmed the plan in November 2019. Implementation was completed on 16 December 2019. Essar Steel India Limited was consequently acquired and integrated into ArcelorMittal Nippon Steel India Limited, a joint venture between ArcelorMittal and Nippon Steel Corporation. The Essar Steel operating identity therefore ceased to function as an independent steel company, although its principal assets continued under the successor enterprise.
History
Essar Steel’s corporate history began within Essar Group’s broader industrial development. Essar Construction Limited was incorporated on 1 June 1976, and its steel division initially manufactured hot-briquetted sponge iron. The steel business was reorganized and renamed Essar Gujarat Limited on 19 August 1987, then Essar Steel Limited on 4 December 1995. In the mid-1990s, the company commissioned a Hazira facility for hot-rolled coils and established pelletisation capacity at Visakhapatnam. It also explored downstream and international growth, forming an Indonesian joint venture for cold-rolled products and, in 2003, establishing a cold-rolled steel unit with Stemcor. The group expanded internationally in 2007 through the acquisition of Algoma Steel in Canada. The Indian company changed its name to Essar Steel India Limited on 18 January 2012. The central Indian operation was an integrated steel plant at Hazira in Gujarat. The wider network included an iron-ore beneficiation plant at Bailadilla, pellet plants at Visakhapatnam and Paradeep, and planned or developing steel projects in Paradeep, Indonesia, Vietnam and Trinidad and Tobago. The Hazira expansion was intended to support a much larger steelmaking platform, but delays in environmental clearances and limited availability of natural gas constrained the project. Falling commodity prices and the financing burden associated with expansion further weakened the company’s financial position. Essar Steel had entered corporate debt restructuring in 2002, reportedly with debt of about Rs 2,800 crore, and exited the process in 2006. Its later distress was substantially more serious. By 2015, financial-creditor dues were reported to exceed Rs 49,000 crore. Lenders considered converting debt into equity and sought potential buyers, while the promoters also indicated an interest in selling the company. No successful private transaction emerged. Following the Reserve Bank of India’s asset-quality review, Essar Steel was among the large stressed accounts directed toward insolvency action. The NCLT admitted the company to insolvency on 2 August 2017 and appointed Satish Kumar Gupta as interim resolution professional. ArcelorMittal and Numetal submitted plans in February 2018, but both were initially found ineligible under Section 29A of the Insolvency and Bankruptcy Code. The dispute went through NCLT, NCLAT and the Supreme Court. In October 2018, the Supreme Court upheld the ineligibility finding while allowing the applicants to clear specified historical dues and resubmit their plans. ArcelorMittal subsequently cleared reported dues of approximately Rs 7,500 crore connected with Uttam Galva and KSS Petron. The creditors’ committee then evaluated revised proposals from ArcelorMittal and Vedanta and selected ArcelorMittal’s plan. The NCLT approved the plan on 8 March 2019. NCLAT approved it with modifications on 4 July 2019, and the Supreme Court ultimately confirmed the resolution on 15 November 2019, particularly resolving disputes over distribution among creditors. Implementation took place on 16 December 2019. Essar Steel India Limited was acquired by ArcelorMittal Nippon Steel India Limited, the ArcelorMittal–Nippon Steel joint venture. Aditya Mittal became chairman and Dilip Oommen chief executive of the successor company. Essar Steel consequently ceased to operate as an independent steel enterprise, although the Hazira-based assets continued under new ownership.
- 2019
Resolution plan confirmed and implemented
[1]The resolution plan was approved through the Indian tribunal and Supreme Court process and implemented by ArcelorMittal Nippon Steel India on 16 December 2019.
- 2017
Insolvency proceedings commenced
[1]The NCLT admitted Essar Steel India Limited to insolvency on 2 August 2017.
- 2012
Indian company renamed Essar Steel India Limited
[1]The operating company changed its name to Essar Steel India Limited on 18 January 2012.
- 2007
Acquisition of Algoma Steel
[1]Essar acquired Canadian steelmaker Algoma Steel as part of its international expansion.
- 2006
Exited corporate debt restructuring
[1]Essar Steel reportedly completed its first restructuring ahead of schedule.
- 2002
First reported corporate debt restructuring
[1]The company entered corporate debt restructuring amid reported debt of approximately Rs 2,800 crore.
- 1995
Corporate name changed to Essar Steel Limited
[1]The business adopted the Essar Steel Limited name on 4 December 1995.
- 1987
Corporate name changed to Essar Gujarat Limited
[1]The company changed its name from Essar Construction Limited on 19 August 1987.
- 1976
Essar Construction incorporated
[1]Essar Construction Limited was incorporated on 1 June 1976 within Essar Group, providing the corporate foundation from which the steel division developed.
Products and positioning
An integrated steel producer built around large-scale flat carbon steel manufacturing, upstream iron-ore processing and pelletisation, and international expansion through overseas steel assets and projects.
Steel
Flat carbon steel
Essar Steel India’s principal business was integrated production of flat carbon steel at Hazira in Gujarat. The operation combined ironmaking, steelmaking and rolling activities and was designed to serve industrial and infrastructure-related demand. The Hazira complex was the company’s central Indian manufacturing asset and the main foundation of its steel brand.
Steel products · 1994
Hot-rolled coils
Hot-rolled coil manufacturing was added to the company’s Hazira operations in the 1990s. These products formed part of the company’s flat-steel portfolio and supported downstream industrial applications. The hot-rolling facility was also a major component of Essar’s strategy to develop a larger integrated steel platform.
Steel products · 2003
Cold-rolled steel
Essar pursued cold-rolled products through an Indonesian joint venture and a cold-rolling unit established with Stemcor in 2003. Cold rolling extended the company’s activity beyond basic hot-rolled products into more processed flat steel. The available reference material does not specify the full product grades or end-use portfolio.
Direct reduced iron
Hot-briquetted sponge iron
Hot-briquetted sponge iron was the original focus of Essar’s steel division. It supplied an iron-bearing input for steelmaking and reflected the group’s early move from construction into metals manufacturing. Later growth centered on a more integrated chain that included beneficiation, pelletisation, direct reduction and finished flat steel.
Ironmaking raw materials
Iron ore pellets
Essar operated pelletisation facilities at Visakhapatnam and Paradeep. Pelletisation converted beneficiated iron ore into a feedstock suitable for direct-reduction and blast-furnace-related steelmaking routes. These plants supported the company’s ambition to control more stages of the raw-material and steel-production chain.
Controversies
2015
Financial distress and allegations surrounding the U.S. subsidiary
The company’s U.S. subsidiary entered bankruptcy proceedings in late 2015 amid allegations of fraud. The available reference material does not provide sufficient detail to characterize the allegations, identify findings, or establish outcomes.
Brand decisions
2019
Accepted ArcelorMittal’s resolution planM&ABackground
Following tribunal and Supreme Court proceedings concerning bidder eligibility and creditor distribution, the creditors’ committee selected ArcelorMittal’s proposal over Vedanta’s plan.
Action taken
The plan was approved by the NCLT, modified by NCLAT, upheld by the Supreme Court and implemented on 16 December 2019 through acquisition by ArcelorMittal Nippon Steel India Limited.
Aftermath
Essar Steel ceased to be an independent operating company, while its principal Indian steel assets continued under the ArcelorMittal–Nippon Steel joint venture.
2017
Entered formal insolvency resolutionOtherBackground
Expansion-related delays, constrained natural-gas availability, weaker commodity prices and a large debt burden caused severe liquidity pressure. Lenders had been unable to complete a consensual sale or restructuring.
Action taken
The NCLT admitted Essar Steel India Limited to insolvency on 2 August 2017 and appointed a resolution professional to manage the process.
Aftermath
The business was subjected to a competitive resolution process involving ArcelorMittal, Numetal and later Vedanta.
Recent events
Reported
ArcelorMittal and Nippon Steel established AM/NS India[2]
ArcelorMittal and Nippon Steel established the joint venture AM/NS India to own and operate Essar Steel India Limited. ArcelorMittal holds 60% of the venture and Nippon Steel holds the remainder.
Reported
ArcelorMittal and Nippon Steel complete acquisition of Essar Steel[3]
ArcelorMittal and Nippon Steel completed the acquisition of Essar Steel, closing a Rs 42,000 crore deal with the company's lenders.
Sources5 sources
- 1Essar Steelen.wikipedia.org
- 2安赛乐米塔尔与日本制铁成立安赛乐米塔尔日本制铁印度公司businesstoday.in
- 3安赛乐米塔尔与日本制铁完成对 Essar Steel 的收购saudigazette.com.sa
- 4ArcelorMittal Acquires Essar Steel; Sets up JV with Nippon Steel To Own, Operate ESILmoneylife.in
- 5ArcelorMittal and Nippon Steel complete acquisition of Essar Steelbusiness-standard.com
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