International Steel Mills
JSW Steel Bids for Bhushan Steel
Written by Sandy Williams
February 13, 2017
JSW Steel has presented a bid to acquire Bhushan Steel for approximately $3.75 billion and gain a 55 percent majority stake. The deal includes taking over Bhushan Steel’s debt which is estimated at $6.68 billion.
Bhushan Steel defaulted on its interest payments in August 2014 and has been working with State Bank of India and Punjab National Bank to restructure its loan or arrange a sale. Sources report that the Bhushan management is not supportive of the acquisition and JSW is negotiating with the lenders directly.
Acquisition of Bhushan Steel would put JSW Steel closer to its goal of becoming a 40 million tonnes per year producer. Bhushan Steel has an annual capacity of 5.6 million tons at its three locations.
Bhushan Steel reported a quarterly net loss in December of 7.34 billion rupees ($109.8 million).
SMU Note: Both JSW and Bhushan Steel have both been active exporters of light gauge galvanized steels to the United States in the past. Currently, India is under an anti-dumping and countervailing duty orders and, with the exception of Uttam, most are not shipping coated steel to the United States.
Sandy Williams
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