Jindal Steel and Power is likely to list its Oman-based wholly-owned subsidiary Shadeed Iron and Steel LLC in Muscat Securities Market for raising around USD 500 million, said a company source.
The proceeds would be used to part fund its USD 2 billion proposed investment plan of the local firm to raise capacity by 2.5 million tonnes per annum over the next 3-4 years.
Naveen Jindal-led JSPL had bought Shadeed Iron and Steel LLC (Jindal Shadeed) in July 2010 from Abu-Dhabi's Al Ghaith Holdings for about USD 500 million. The capacity of the plant, the third largest in the Middle East, now stands at 2 mtpa.
"Listing of the company on the local bourse is aimed at raising fund for the proposed USD 2 billion expansion over the next 3-4 years to take its capacity to 4.5 mtpa," the official said.
The listing, which is aimed at raising about USD 500 million, may happen next year, he said.
Environmental clearance for the proposed expansion of the plant is likely to come in next 8-9 months and after that the company would start placing orders, looking at completing the expansion by end of 2017 or early 2018.
Jindal Shadeed has sufficient land for moving ahead with the plant expansion. Raw material for the expanded facility would not pose a problem in future, he said.
JSPL foresees a tremendous surge in demand for iron and steel in the gulf markets on huge infrastructure spending. It is now producing billets and rounds at the Oman facility and on course to set up 1.6 mtpa rebar mill, which was expected to be commissioned by September-October next year.
The official said the expansion plans are expected to proceed smoothly as the Gulf nation is determined to achieve its Vision 2020 of diversifying from oil as a major source of income to other allied activities such as metals, downstream oil and gas.
