Ispat merges with JSW Steel

Sajjan Jindal-led JSW Steel, on Saturday, announced the merger of renamed JSW Ispat with itself, 20 months after acquiring a controlling stake in rival Ispat Industries.

1:72 swap ratio

The boards of directors of both companies have approved the merger with a swap ratio of 1:72, that is, one equity share of JSW Steel for every 72 shares of JSW Ispat.

The merger is subject to necessary approvals.

“Merger of JSW Ispat with JSW Steel is an important step in our ongoing growth journey towards creating a world-class global steel company. JSW Ispat brings several unique advantages and the merger will help in realisation of integration benefits of the two companies,” JSW Steel Chairman and Managing Director Mr.Jindal said while announcing the merger.

In December, 2010, JSW Steel came in as a major investor in Mittal-owned debt laden Ispat Industries by investing Rs.2,157 crore and became the largest shareholder.

In the post-merger equity share capital, the promoters of JSW Steel will own 35.12 per cent, JFE Steel 14.92 per cent and the public the balance 49.96 per cent in the merged entity.

The downstream units of both companies will be transferred to a wholly-owned subsidiary of JSW Steel and the appointed date of the merger will be July 1.

The integration is expected to bring significant advantages, particularly in alternative steel making technologies and pan India market reach. It will also yield considerable financial benefits to JSW Steel, which will utilise JSW Ispat’s unabsorbed tax losses of Rs.2,000 crore, besides making optimal use of depreciation on further capital investments.

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Printable version | Nov 26, 2021 1:18:18 PM |

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