JSW Steel to buy JSW Praxair Oxygen for Rs. 240 cr
The Dollar Business Bureau
Indian private sector steel major, JSW Steel, said on Tuesday that it will buy 74 percent share in JSW Praxair Oxygen Pvt Ltd (JPOPL) for Rs.240 crore in an all-cash deal.
JPOPL is into the production of industrial gases including nitrogen, oxygen and argon. The company has two air separation units, each having a capacity of producing 2, 500 tonnes a day. The plants are situated in the Bellary district of Karnataka.
“JSW Steel has executed a share purchase agreement with Praxair India to acquire their entire shareholding of 74 percent in JPOPL for a cash consideration of Rs.240 crore,” the company said in a regulatory filing.
Sajjan Jindal-led JSW Steel has a shareholding of 26 percent in the JPOPL. After acquisition, JPOPL would become a fully-owned arm of the JSW Steel, it added.
From JPOPL, the company procures industrial gases, among others products, at the rates based on the long-term contracts.
“The mentioned deal is strategic in nature because it will provide JSW Steel the advantage of backward integration of this crucial input,” said the company.
The legal and financial due diligence for the company are carried out by Bharucha & Partners, Advocates and Solicitors, and Deloitte Touche Tohmatsu India LLP, respectively, it added.