JSW Steel may raise funds via rights issue

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Mumbai, Oct 22: Sajjan Jindal-led JSW Steel has said it will consider raising additional long-term resources, including issuance of equity shares or other securities, through a rights issue at its board meet next week.
The promoter and promoter group hold 42.32% stake in the company, while 57.12% is held by the public.
Employee trust and non promoter-non public hold 0.56% each.
“At its meeting on October 25, the board would be considering raising of additional long-term resources, including but not limited to, issuance of equity shares or other securities by way of a rights issue subject to regulatory approvals,” JSW Steel said in a regulatory filing.
The board will also finalise the un-audited standalone and consolidated financial results of the company for the quarter and half-year ended September 2018 and the payment of dividend at the contracted rate on the 10% cumulative redeemable preference shares of the company for the financial year 2018-19, up to the date of its final redemption, it added. According to a banking source, “JSW Steel is exploring differentiated financing options, including joint control model, to fund its acquisition of stressed assets of Bhushan Power and Steel.”
This assumes significance as JSW Steel’s Rs 19,700 crore offer for debt-laden Bhushan Power and Steel (BPSL) has been backed by around 90% of lenders. Under the joint control model, a special purpose vehicle (SPV) will be set up and the acquired stressed assets will rest with the SPV.
The joint control model will insulate debt impact of yet to be acquired stressed assets of these two firms on JSW Steel financials. If acquired, JSW Steel is exploring to merge the stressed assets of the both companies into its books post turnaround of the stressed assets. Bhushan Power is among the 12 non-performing accounts referred by the RBI for NCLT proceedings and owes about Rs 45,000 crore to its lenders. JSW Steel had earlier teamed up with NuMetal Mauritius to place a Rs 37,000-crore offer for Essar Steel in the second round of bidding.
JSW preferred bidder for mine in K’taka
JSW Steel has emerged as the preferred bidder for an iron ore mine in Karnataka, which went under the hammer last month, said an official document. The cumulative revenue from the block over 50 years is Rs 1,705 crore with an additional contribution of Rs 1,450 crore through auction.