Now, JSW Steel explores tieups to acquire stressed assets

MUMBAI: Sajjan Jindal-controlled JSW Steel Ltd may team up with external investors to set up a platform for acquiring distressed assets, a top company official said. The group is open to various options including setting up a platform in partnership with financial sponsors as it looks for inorganic growth and opportunities in the distressed assets space where a number of large steel companies are facing bankruptcy, said Seshagiri Rao, joint MD and group CFO.

“There are various structures which we are open to exploring and this is one of them,” Rao said. “But only when a specific asset is identified and the resolution process is decided, I will be able to give a definite answer.”

Rao said the company is also actively looking at acquisitions in Europe, especially in the downstream segment. “If you look at assets available in Europe the capital employed per million tonne is significantly lower that it is otherwise needed in India to pursue opportunities whether organic or inorganic.”

Distressed assets platforms typically involve incorporating a separate entity to be used as an investment vehicle to acquire the assets. A recent example is Resurgent Power Ventures Pte Ltd, jointly created in Singapore in September last year by Tata Power along with private equity fund ICICI Venture, Canadian pension fund CDPQ, sovereign wealth funds State General Reserve Fund of Oman and Kuwait Investment Authority.