JSW Steel has entered into a definitive agreement with Welspun Enterprises (WEL), pursuant to which the company shall acquire the entire equity share held by WEL in Welspun Maxsteel (WMSL) for an enterprise value of Rs 1,000 crore plus net current assets as of an agreed date of August 31, 2014, subject to the relevant regulatory approvals and customary closing conditions. Ernst & Young and Luthra & Luthra carried out financial and legal due diligence respectively for the Company.
The company is a major player in the Indian steel industry with an installed capacity of 14.3 MTPA. The company has a strategic goal to enhance its steel production to 40 MTPA in the next decade. WMSL is situated in close proximity to the company's Dolvi unit, offering complimentary infrastructure and locatiion to augment the current envisaged expansions at Dolvi. In line with this objective, JSW wishes to acquire th equity shares of WMSL.
WMSL has an installed capacity of 0.9 MTPA gas based DRI plant, with a captive jetty and a captive railway siding. DRI plant is locatied in Salav village in Raigad district of Maharashtra. Captive jetty has an existing capacity of 2.5 MTPA which is located at 1.8 km fromthe plant, while the captive railway siding is located at Raha junction on national Konkan Railway, 35 km from the DRI plant WMSL also has vacant land of approximately 480 acres, available for future expansions.
The company has surplus pellets in its subsidiary Amba River Coke which will be supplied to WMSL. The cost of production in WMSL is expected to come down due to replacement of significant portion of its bought-out pellets with captive pellets. The DRI produced by WMSL shall initially be used partly by the company's Dolvi unit, and would be consumed in the entirety post completion of its ongoing expansion to 5 MTPA.
The company is a major player in the Indian steel industry with an installed capacity of 14.3 MTPA. The company has a strategic goal to enhance its steel production to 40 MTPA in the next decade. WMSL is situated in close proximity to the company's Dolvi unit, offering complimentary infrastructure and locatiion to augment the current envisaged expansions at Dolvi. In line with this objective, JSW wishes to acquire th equity shares of WMSL.
WMSL has an installed capacity of 0.9 MTPA gas based DRI plant, with a captive jetty and a captive railway siding. DRI plant is locatied in Salav village in Raigad district of Maharashtra. Captive jetty has an existing capacity of 2.5 MTPA which is located at 1.8 km fromthe plant, while the captive railway siding is located at Raha junction on national Konkan Railway, 35 km from the DRI plant WMSL also has vacant land of approximately 480 acres, available for future expansions.
The company has surplus pellets in its subsidiary Amba River Coke which will be supplied to WMSL. The cost of production in WMSL is expected to come down due to replacement of significant portion of its bought-out pellets with captive pellets. The DRI produced by WMSL shall initially be used partly by the company's Dolvi unit, and would be consumed in the entirety post completion of its ongoing expansion to 5 MTPA.
No comments:
Post a Comment