Home >companies >China’s Baosteel to pick up 5% stake in Visa Steel


China’s Baosteel to pick up 5% stake in Visa Steel

The company is also looking to merge Visa Bao Ltd, a joint venture of Baosteel and Visa Steel, with itself

Mumbai: China’s Baosteel Resources Co. Ltd will pick up a 5% stake in Visa Steel Ltd, the Indian company said on Friday. The company is also looking to merge Visa Bao Ltd, a joint venture of Baosteel and Visa Steel, with itself.

“Consequent to the amalgamation, Baosteel will hold 5% stake in Visa Steel. The amalgamation was approved by the board of directors of Visa Steel Ltd and Visa Bao Ltd at a meeting held in Kolkata on 21 August, and is subject to necessary approvals from regulatory authorities," Visa Steel said in a statement.

Lenders to Visa Steel, who are restructuring its debt, have approved of the merger.

Visa Steel holds a 65% stake and Baosteel 35% in Visa Bao Ltd, which was set up for a ferro-chrome plant in Odisha.

“The amalgamation of Visa Bao with Visa Steel will make Visa Steel one of the largest ferro-chrome producers in India. The integration will improve the operational and cost efficiency of the ferro-chrome business," said Vishal Agarwal, vice-chairman and managing director at Visa Steel.

Visa Steel is also trying to find a strategic investor for its special steel business. As a prelude, the company is transferring 0.5 million tonne per annum special steel capacity to its subsidiary Visa Special Steel Ltd.

On Friday, Visa Steel shares closed at 15.25 apiece on BSE, little changed from their previous close of 15.15, even as the benchmark Sensex closed at 27,366.07, down 0.88%.

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