Sajjan Jindal-controlled JSW Steel is bailing out Ispat Industries by picking up a majority stake of 41% in the company, which is owned by Pramod Mittal and Vinod Mittal, younger siblings of Lakshmi Mittal of ArcelorMittal.
The deal will make Jindal the largest private sector steel maker by capacity in India. It is also expected to bring Ispat back to profit after its debts of Rs 7,500 crore are refinanced and Rs 3,100 crore injected as capital expenditure.
Ispat, which is to be renamed JSW Ispat Steel, will issue 108.66 crore equity shares on a preferential basis at Rs 19.85 per share for Rs 2,157 crore.
JSW will also make an open offer for an additional 20% to the minority shareholders of Ispat as per Sebi guidelines, at a marginal premium of Rs 20.54, which would entail an additional spending of around Rs 1,200 crore
Source: TOI
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