Debt-laden Jindal Steel & Power Ltd (JSPL) has sold oxygen plant assets at two of its steel mills to Kolkata-based Srei Equipment Finance Ltd for Rs 1,121 crore ($171 million).
The firm disposed of oxygen plants at a 6 million tonnes per annum (MTPA) steel plant at Angul in Odisha and a 3.6 MTPA facility at Raigarh in Chhattisgarh, it said in a stock exchange disclosure.
JSPL also entered into a lease-back agreement with the buyer for the continued operation of oxygen plants at its steel mills.
“The divestment of oxygen plant assets is aimed at making JSPL an asset-light company. JSPL will continue to manage these cutting-edge oxygen plant capacities for its 9.6 MTPA domestic steel plants under a lease-back agreement, retaining full operational control,” said Naushad Ansari, chief executive officer of steel business at JSPL.
JSPL is part of the $18 billion diversified OP Jindal Group. Its business operations are spread across Asia, Africa and Australia.
In October 2016, JSPL inked a deal to divest a 24MW wind power generating business at Satara in Maharashtra to IDFC Alternatives.
In May 2016, Sajjan Jindal-led JSW Energy Ltd agreed to acquire a 1,000-megawatt thermal power plant in Chhattisgarh from JSPL for up to Rs 6,500 crore ($975 million), including debt.
In FY17, JSPL’s consolidated revenue stood at Rs 22,706 crore and loss after tax was Rs 2,537 crore. As on 31 March 2017, the net debt of the company was Rs 45,373 crore.
Srei Equipment Finance is a fully owned subsidiary of Srei Infrastructure Finance. As on 31 March 2017, outstanding equipment finance loan stood at Rs 14,527 crore.
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