Essar Energy said it has agreed to buy Royal Dutch Shell's Stanlow refinery in northwest England for $350m (£215.7m) in cash, giving the Indian focussed oil and gas business direct access to the UK market.
Essar Energy, which has a majority stake in India-listed Essar Oil, said it had entered into an exclusive agreement until 31 March to buy the second largest refinery in the UK.
Naresh Nayyar, Essar Energy's chief executive, said Stanlow was a high quality refinery in terms of its employees, its assets, its location and its customer base.
"Stanlow also fits very well with our strategy of providing options for the export of high quality products from our Vadinar refinery in India," he said.
The exclusivity period allowed Shell to consult with its employees at the site, Essar said. It will pay Shell a break fee of $50m if it does not proceed with the purchase.
Essar will make a separate payment for the oil and refined products on the site, estimated to be worth about $780m based on current prices, when the deal completes.
City A.M. Reporter