Domestic steel major Ispat Industries has entered into a pact with Stemcor, the world’s largest independent steel trader to sell 10% stake through preferential allotment. Stemcor will also provide $75 million working capital to the company under an export securitisation programme, Ispat said in a statement.
The steel trading major will also invest towards expanding the facilities to 3 million tonnes a year pellet plant in a planned manner. Ispat Energy is also setting up a 110 MW and a planned 1
million tonne coke oven plant.
The company has an annual production capacity 3.3 million tonnes in Maharashtra while Stemcor trades about 15 million tonnes of steel and steel making raw materials per annum. It also owns investments in manufacturing projects in steel related raw materials.
The deal will also help Ispat Industries cut down its huge debt to the tune of Rs 6500 crore.
Ispat Industries reported a net loss of Rs 69.24 crore for the quarter ended June 2010, which was much lower than a net loss of Rs 214.92 crore for the quarter ended June 2009. Net sales rose 81.3% to Rs 2349.87 crore in the quarter ended June 2010 over the quarter ended June 2009.