Japan's JFE Steel Corporation is investing in a joint venture with India's JSW Steel Limited to manage the steel business of Bhushan Power and Steel Limited (BSPL), a company acquired by the latter during bankruptcy proceedings, according to a statement from the Japanese company on Wednesday, December 3.
JFE Steel Corporation is investing approximately $1.75 billion to acquire a 50 percent stake in the joint venture, JSW Kalinga Steel Limited, which will manage BPSL's steel assets, the statement said.
The joint venture plans to expand BSPL's crude steel production capacity to 10 million tons per year by 2030 from the current 4.5 million tons per year at its plant located in the eastern state of Odisha.
BPSL owns an iron ore mine and integrated steel mill in eastern India with a crude steel production capacity of 4.5 million tons per year. It produces steel coils, sheets, rods and wire rod.
"By bringing JFE's technological advantages and combining them with JSW's operational expertise, companies will be able to expand production of high—value-added products and increase productivity," JFE Steel Corporation said in a statement.
JSW Steel Limited acquired BPSL in 2019 for approximately 2.19 has invested another $501 million in capital expenditures for the development and maintenance of the company through the Insolvency and Bankruptcy Code.
We have entered into an agreement, including equity participation, to license technologies for the production of automotive steel and sheets of non-oriented electrical steel, as well as to establish a joint venture for the production of sheets of textured electrical steel. Our relationship is now entering a new phase. I am confident that by leveraging our technological advantages and jointly managing an integrated steel mill in India with JSW, today's announcement combines JSW's experience in India with JFE's technological advantages and will enable the joint venture to realize its growth potential and produce various types of value—added steel," said Jayant Acharya, Joint Managing Director of JSW Steel Limited. said.
The deal is subject to regulatory approval, including the Indian Competition Commission.
