ET citing sources with direct knowledge reported that JSW Steel has begun merger talks with Ispat Industries which will give huge tax benefits of close to INR 2500 crores to the merged entity.
JSW Steel owns around 49% stake in Ispat and is in the process of restructuring its INR 7000 crores debt for it to exit the Corporate Debt Restructuring. Soon after Ispat is out of CDR, the merger process will be put on the fast track while the talks have already begun.
Sources said that Mr Vinod Mittal who owns 26% stake in Ispat could hold less than 5% stake in the merged entity of JSW Steel. The merger of Ispat Industries with JSW Steel could be at a swap ratio of 4:1 based on the market cap, though the valuations are being worked out currently.
Experts said that JSW Steel will want to merge the companies to get full management control on Ispat's operations and to make use of the tax benefits which Ispat has accumulated by way of carry forward accumulated losses. The accumulated losses are around INR 8000 crores which could have the tax savings of close to INR 2500 crores. (sourced from ET)
JSW Steel owns around 49% stake in Ispat and is in the process of restructuring its INR 7000 crores debt for it to exit the Corporate Debt Restructuring. Soon after Ispat is out of CDR, the merger process will be put on the fast track while the talks have already begun.
Sources said that Mr Vinod Mittal who owns 26% stake in Ispat could hold less than 5% stake in the merged entity of JSW Steel. The merger of Ispat Industries with JSW Steel could be at a swap ratio of 4:1 based on the market cap, though the valuations are being worked out currently.
Experts said that JSW Steel will want to merge the companies to get full management control on Ispat's operations and to make use of the tax benefits which Ispat has accumulated by way of carry forward accumulated losses. The accumulated losses are around INR 8000 crores which could have the tax savings of close to INR 2500 crores. (sourced from ET)
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