Source : TNN, May 21, 2010, 12.47am IST
NEW DELHI: Naveen Jindal-led JSPL will acquire Oman-based Shadeed Iron & Steel Co for $464 million, marking its first overseas presence in the steel sector.
The company concluded the buyout agreement with UAE's Al Ghaith Holdings, which owns the Shadeed Iron & Steel Co. "Jindal Steel & Power (JSPL) through its 100% subsidiary Jindal Steel & Power (Mauritius) has decided to acquire Shadeed Iron & Steel Co (Shadeed), a company incorporated under the laws of the Sultanate of Oman," the leading domestic steel maker said in a statement.
"...a definitive Share Purchase Agreement (SPA) and other transaction documents have been signed at $464 million including the assumption of liabilities," it added. The company said it has tied up $400 million in debt financing from international banks and the balance will come from internal accruals.
JSPL director Sushil Maroo said, "The acquisition is part of our plans to expand operations overseas. It is a gas-based unit. We are also setting up 2 MTPA gas-based units in India. It is a strategic fit for us. "It will mark our first overseas presence in the steel space." At the mining front, JSPL had recently acquired several coal and iron ore mines in Africa and Bolivia. With Shadeed's acquisition, the company aims to tap the burgeoning construction and infrastructure market of the Middle East.
"There is a strong demand for steel in the Middle East and North African countries, with a supply shortfall estimated to be over 15 million tonnes," it added. Shadeed is setting up a 1.5 MTPA gas-based steel plant at Sohar Industrial Port area, Oman.
"This is a tremendous acquisition for JSPL as the facility is engineered by Kobe Steel and Midrex, leaders in the field of direct iron technology and JSPL believes facility can be made operational within a year.
No comments:
Post a Comment