Indian’s largest steel maker by capacity JSW Steel Ltd will acquire 50 per cent stake in Vallabh Tinplate Pvt Ltd (VTPL) for around 46 crore ($7.42 million), as per a stock market disclosure.
This acquisition will mark JSW Steel’s entry into tinplate business in India and expand its value-added products business. The company has set a target for pushing up the contribution of value-added products to 40 per cent of overall revenues.
JSW Steel has signed a legally binding share purchase agreement and shareholders’ agreement to initially buy 26 per cent of VTPL and to increase its stake to 50 per cent in due course.
New Delhi-based VTPL manufactures steel products like tin plate, colour coating line, etc. The firm is currently operating a 60,000 MT per annum tinplate manufacturing facility in Beopror Village, Punjab.
VTPL is a part of Vallabh Group which comprises three more companies—Vallabh Steels Ltd (VSL), Vardhaman Industries Ltd (VIL) and Vallabh Textiles Company Ltd (VTCL). The firm is owned by VIL along with its promoters.
Mumbai-based JSW Steel manufactures flat steel products, upstream offerings, including mild steel hot-rolled coils, plates & sheets and tolerances, and downstream products such as hot-rolled plates, cold-rolled close annealed sheets & coils, and galvanised sheets & coils. It has an installed capacity of 14.3 million tonnes.
Earlier this month, the firm raised Rs 1,000 crore through an issue of secured listed redeemable non-convertible debentures (NCDs).
Shares of JSW Steel were trading at Rs 885.55 a unit, down 0.07 per cent at 11.39 am in a flat Mumbai market on Monday.
(Edited by Joby Puthuparampil Johnson)