JSW Steel Acquires Bellary Steel and Alloys' Assets For Rs 210 Cr

By Deeshesh Chheda January 17,2011 - 06:09 PM

JSW Steel Limited has bought Bellary Steel & Alloys's assets for Rs.210 Cr from consortium of lenders led by project lender IFCI.
The assets which include Bellary Steel's land, buildings and branded machinery, would compliment JSW's 7 MT steel plant in the Bellary-Hospet region.
Bellary Steel has a half constructed steel plant with a capacity of 0.5 MT.
JSW Steel's bid was higher than the bid placed by Sesa Goa at Rs.206 Cr.

Transaction Reference:
Transaction Note
Bellary Steel had planned to set up an integrated steel plant, with 0.5 MT p.a. capacity and a provision of taking it to 2 MT, at Bellary in Karnataka.
However, BSAL, whose biggest asset is 700 acre freehold land, could not complete the project and ran into debt.
The consortium of lenders led by IFCI decided to sell the assets of the company under the Securitisation & Reconstruction of Financial Assets & Enforcement of Security Interest Act (SARFAESI), which empowers banks or financial institutions to recover non-performing assets.
Bellary Steel's sales were down by 20.83% from Rs.40.13 Cr in 2008-09 as compared to Rs.50.44 Cr.
The Company has incurred a loss after tax of Rs. 143.61 Cr during 2008-09 as compared toa loss of Rs. 115.57 Cr for the previous year.
It's accumulated loss up to the year ended March 2009 is Rs.802.92 Cr as compared to Rs.659.31 Cr for the previous year.
In December, JSW Steel bought a controlling stake in smaller loss-making rival Ispat Industries for $476 million.
With Ispat, JSW will become India’s largest steel maker by March 2011, when its Vijayanagar plant commissions an additional three MT, taking its total capacity to 14.3 MT. The company had planned a target of 34 MT by 2020.
JSW Steel that operates a 6.8 mtpa steel plant at Toranagallu in Bellary district of Karnataka, has sought 1,100 acres of land more from the Karnataka government to expand its steel mill capacity.
At present, JSW Steel owns 3,700 acres in Toranagallu with the capacity of the plant to reach at 10 mtpa by March 2011. JSW buys iron ore from private mine owners near its plant and the new railway line will be used to transport ore to its steel plant.
JSW Steel manufactures flat and long products such as HR coils, CR coils, galvanised products, auto grade/white goods grade CRCA steel, bars and rods.
Source: www.dealcurry.com