JSW Steel arm to tap US municipal bond market

New Delhi, Aug. 25: JSW Steel on Wednesday said its wholly owned indirect subsidiary JSW Steel USA Ohio is considering a proposal to raise longterm funds from the municipal bond market in the US.

The company shall provide a guarantee on behalf of JSW Steel Ohio, which will be utilised to secure the repayment of the bonds, JSW Steel said in a BSE filing.

"JSW Steel USA Ohio, Inc is considering a proposal for raising long term funds of more than 30 years in the municipal bond markets in the USA.

"The Jefferson County Port Authority, a port authority and a body corporate and politic organised and existing under the laws of the State of Ohio (Port Authority) will be issuing special, limited obligations bonds, the proceeds of which will be utilised for extending a loan to JSW Ohio," it said.

It said the bonds will be repaid out of proceeds from repayment of loan received from JSW Steel Ohio and the bondholders will have no recourse to the port authority.

The company shall provide a guarantee on behalf of JSW Steel Ohio, which will be utilised to secure the repayment of the bonds.

"The proceeds of the loan are proposed to be utilised for the purpose of refinancing/ reimbursing, in whole or in part, the cost of the modernisation of an electric arc furnace...at the steel facilities located in

Jefferson county, Ohio and the caster modernisation including the installation of a level 2 automation system to allow for the production of higher quality steel slabs at the facility," it said.

JSW Steel further said it will discuss the bonds issuance with certain potential investors.

A preliminary offer document has been prepared and shall be made available to the prospective investors in relation to the contemplated issue of bonds, it added.