JSPL to sell power biz to promoter firm for ₹3,015 cr
MUMBAI: Jindal Steel and Power Ltd (JSPL) on Tuesday said its board has approved the sale of its power subsidiary Jindal Power Ltd to Worldone, a promoter group company, for ₹3,015 crore.
Worldone was selected after it submitted the highest binding bid on acceptable terms and conditions in a bidding process run by Grant Thornton Advisory, JSPL said.
“The board of directors of JSPL has approved the divestment of its entire equity interest (representing 96.42% of the issued and paid-up capital) in Jindal Power by way of sale of shares, to Worldone Pvt. Ltd, a promoter group company and a related party to the company,” JSPL said in a regulatory filing.
It added that the divestment is in line with JSPL’S strategic objective to continuously reduce its debt, focus on its India steel business and significantly reduce its carbon footprint by almost half as part of its environmental, social and corporate governance (ESG) objectives.
“This divestment is yet another step towards our vision to reduce debt substantially and create a robust balance sheet for our investors and stakeholders,” said JSPL managing director VR Sharma, adding that the company will now focus on undertaking an expansion of its Angul steel plant from 6 million tonnes per annum (mtpa) to 12 mtpa.
“Infrastructure spending in India is bound to grow exponentially and JSPL is fully aligned with the government’s vision of achieving 300 mtpa steel production by 2030. We firmly believe in the India growth story and its potential to be an engine of global growth,” he added.
The proposed sale is subject to necessary approvals from JSPL shareholders, regulators, lenders and Jindal Power.
“Long-stop date for completion of the proposed sale is 12 months which maybe mutually extended by the parties thereto, failing which the proposed sale shall terminate,” JSPL said.
The board also approved the execution of a binding share purchase agreement, a loan agreement, and other ancillary agreements in relation to the proposed sale and, accordingly, the company has executed a share purchase agreement.