Essar to invest $210 m to buy 6 supramax

Mumbai: The Essar Group would be acquiring six supramax bulk carriers at an investment of $210 million (Rs 840 crore).

The group company, Essar Shipping and Logistics Ltd, has placed orders for these vessels with ABG Shipyard Ltd in India, the company said on Monday.

These bulk carriers are of 54,000 dwt each (double-hull fitted with 36 tonnes crane with grab), and would be deployed for coal movement in the Asia-Pacific market.

According to Mr Sanjay Mehta, CEO, Essar Shipping and Logistics, the company received a very attractive rate of $35 million for each vessel from the Indian yard. It would have cost them at least $25 million more at overseas yards.

By placing the order with the Indian yard, the company can monitor the pace and quality of construction more closely.

The vessels will be delivered between December 2009 and March 2011.

The acquisition has been made keeping in view, the increased demand for larger size vessels in the handymax segment of the dry bulk trade.

These vessels will be in high demand over the coming years considering the fact that the entire handymax segment is inching towards larger tonnage, he said.

The decision to build these bulk carriers stems from Essar’s strategy to be equipped for future business needs.

These vessels will go a long way in consolidating its position as a dependable global logistic provider, said Mr Mehta,

The Essar group now has a total fleet of 27 ships with a capacity of 1.3 million dwt. Essar Shipping and Logistics is a subsidiary of Essar Global.