JSW Steel to formalize Welspun Maxsteel acquisition in 15 days
The firm will also take over Welspun Maxsteel's debt of `1,030 crore in a deal that is being valued at `1,100 crore
Mumbai: JSW Steel Ltd will formalize its purchase of smaller rival Welspun Maxsteel Ltd in 15 days, in what would mark a step ahead in JSW’s aggressive plans for capacity expansion, two company officials said on Monday.
“The deal size is about ₹ 1,100 crore," one of the officials said, requesting anonymity.
JSW Steel will also take over Welspun Maxsteel’s debt of ₹ 1,030 crore, the second official said.
JSW Steel is India’s third largest steel company after Tata Steel Ltd and Steel Authority of India Ltd (SAIL) with a total steelmaking capacity of 14.3 million tonnes.
The firm, which is pursuing an aggressive expansion path, is also conducting due diligence on Italy’s Lucchini SpA which is insolvent, but could prove to be a stepping stone into Europe where the economy is recovering.
It is also a frontrunner in bidding for UK steel trader Stemcor’s Indian assets.
Welspun Maxsteel is the former sponge iron division of Aditya Birla Group’s Grasim Industries Ltd that was acquired by the $3 billion Welspun Group in 2009, according to the company’s website. Spread across 435 acres in Maharashtra’s Raigad district, it has a captive port. It has an installed capacity of 900,000 tonnes per annum and produces direct reduced iron and hot briquetted iron.
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