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Informist, Wednesday, Dec. 3, 2025

 

--JSW Steel board OKs JV with Japan co for Bhushan Power's steel business

--Japan co JFE Steel to acquire 50% stake in JSW Steel arm for INR 157.5 bln

 

KOLKATA - JSW Steel Ltd. Wednesday said it has entered into a strategic joint venture partnership with Japanese JFE Steel Corp. for the steel business of its subsidiary, Bhushan Power and Steel Ltd. As part of the agreement, the steel business of Bhushan Power and Steel will be transferred to a 50:50 joint venture with JFE Steel Corp. by way of a slump sale for a cash consideration of INR 244.8 billion.

 

The Japanese company will invest INR 157.5 billion in two tranches to acquire the 50% stake in the joint venture, JSW Steel informed exchanges. 

 

Through the transaction, JSW Steel will monetise part of its holding in Bhushan Power and Steel to accelerate growth at the company level, according to the statement. The cash proceeds from the transaction will further strengthen JSW's balance sheet and provide a clear runway for growth, creating significant value for its stakeholders, the company said.

 

JSW Steel had acquired Bhushan Power and Steel in 2021 through the corporate insolvency route. Bhushan Power has a crude steel capacity of 4.5 million tonnes per annum.

 

As part of the deal, the steel business of Bhushan Power and Steel will be first transferred to Sambalpur Steel Ltd. by way of a slump sale on a going-concern basis for a cash consideration of INR 244.8 billion. JSW Sambalpur Steel is currently held by JSW Kalinga Steel Ltd., and JSW Kalinga Steel, in turn, is a wholly owned subsidiary of Piombino Steel Ltd. JSW Steel holds an 82.65% stake in Piombino Steel, with the remaining stake held by another group entity, JSW Shipping & Logistics Pvt. Ltd.

 

After the transfer, JFE Steel Corp. will acquire a 50% stake in JSW Kalinga Steel at an aggregate consideration of INR 157.5 billion. This will result in JSW Kalinga Steel becoming a joint venture between the OP Jindal group company and the Japanese steelmaker. In turn, Bhushan Steel and Power, which will henceforth be housed under Kalinga Steel, will also have a joint ownership between these two companies.

 

JSW Steel and JFE Steel Corp. will have the right to appoint two directors each in JSW Kalinga Steel and three directors each in JSW Sambalpur Steel, according to the terms of the agreement. Hiroyuki Ogawa, a member of JFE Steel Corp.'s board, is currently a nominee director at JSW Steel.

 

In a separate notice to the bourses, JSW Steel said its board has approved a scheme of amalgamation under which Piombino Steel, the current parent of Bhushan Steel and Power, will be merged with JSW Steel. Once the steel business of Bhushan Steel and Power is transferred to Sambalpur Steel, JSW Steel will issue 10 fully paid-up equity shares of INR 1 each to the equity shareholders of Piombino Steel for every 156 fully paid-up equity shares of INR 10 each held by them.

 

"JFE (JFE Steel) has been a trusted partner for JSW Steel since 2009, and the relationship has strengthened over the years as both companies have collaborated on numerous initiatives," Jayant Acharya, joint managing director and chief executive officer at JSW Steel, said in the statement. "Today's announcement brings together JSW's expertise in India with JFE's technological strengths, and will enable the joint venture to realise its growth potential and produce a variety of value-added steels."

 

In 2024, JFE Steel Corp. and JSW Steel established a joint venture, JSW JFE Electrical Steel Pvt. Ltd., to manufacture grain-oriented electrical steel in India.

 

JSW Steel is targeting to achieve a steelmaking capacity of 50 million tonnes per annum in India by 2030-31 (Apr-Mar). The company said it believes India presents a multi-decadal growth opportunity and wants to ensure it is well-positioned to capitalise on it.

 

The present transaction is aimed at securing the company's growth in a financially prudent manner, enabling it to pursue its aspirations across business cycles, JSW Steel said.

 

Wednesday, shares of JSW Steel closed 1.6% lower at INR 1,143.60 on the National Stock Exchange. End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Avishek Rakshit

Edited by Saji George Titus

 

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