“JSW, India's leading priavte sector steel producer, is in talks to buy a significant stake in Sandur Manganese and Iron Mines (SMIORE), one of the big mines located in Karnataka, at a considerable premium to its current market price,” said industry sources.
The promoters, who own 74.15% stake in the company, have appointed investment banker Edelweiss Financial Services to scout for a buyer.
JSW, India's largest domestic steelmaker by capacity, currently sources iron ore from India's largest iron ore miner, the state-owned National Mineral Development Corporation, through e-auction. The iron ore comes from NMDC's mines in Odisha and Chhattisgarh. The proposed transaction is intended to ensure assured supply from the Sandur mines located 30 km from its 12 million tonne Vijayanagar plant in Karnataka. The company is already buying a part of its iron ore requirement from Sandur.
“We are open to selling stake in the listed company to a partner if they are interested in buying surplus iron ore for which an equity holding is essential, '' Nazim Sheikh, joint managing director, Sandur Manganese and Iron Ores said.
''We are in talks with five strategic investors including JSW to build an alloy steel plant with an investment of anywhere between 900 crore and 1,000 crore which is partly financed by equity and debt.'' Sandur will continue to own majority stake in the new joint venture, he added. The iron ore supply to JSW's Vijaynagar plant, which used to be sourced primarily from its Karnataka mines, jointly owned by the Karnataka government, was hit after theSupreme Court ordered all mines in the state to sell iron ore through e-auction.
-Sourced
Leave a Reply