India Jindal’s two major steel companies will merge

India Jindal Steel Limited (JSL) said in a statement recently that the company will merge Jindal Stainless Hisar Limited (JSHL). Abhyuday Jindal, managing director of JSL, said in a statement that the merger of JSL and JSHL will simplify the capital structure and expand the combined business turnover to approximately US$2.73 billion. \

According to the statement, the physical annual steel production capacity of the two companies after the merger is 190 tons, which will become the only Indian company among the world’s top ten stainless steel producers. The boards of Jindal Stainless Steel Co., Ltd. (JSL) and Jindal Stainless Steel (Hisar) Limited (JSHL) have accepted the recommendations of their respective board committees and approved the merger of JSHL into JSL.

According to the approved share conversion ratio, 195 JSL shares will be issued for every 100 JSHL shares. Mr. Abhyuday Jindal, Managing Director of JSL and JSHL, said: “I believe that the proposed merger of JSHL into JSL will increase the value of its company’s shareholders. The merger will take advantage of the complementary advantages of each company. Infrastructure, process and operational synergies of JSL and JSHL The merger will also simplify the capital structure and expand the combined business turnover to 200 billion rupees.

The combined company has a smelting capacity of 1.9 MTPA. It will become the only Indian company among the world’s top ten stainless steel companies. This transition attempts to strengthen The government’s “Atmanirbhar Bharat” mission.” The merger of JSHL into JSL will create a large stainless steel entity that will rank among the top ten stainless steel companies in the world and the largest stainless steel company in India.

The merger will enhance the company’s product portfolio and better serve customers with 360-degree coverage, providing customers with seamless, single-window, pan-Indian and global network access, and further promote a “just in time” approach. The business combination will reorganize the combined entity into an integrated, modern, “state-of-the-art” merger that will bring JSL close to ports and raw materials, as well as a world-class finishing line, thereby achieving enhanced operational synergy. As well as JSHL’s main internal consumption center in the near future, the merged entity will use Jajpur’s existing infrastructure for cost-effective Brownfield expansion, thereby providing growth reinvestment opportunities.

After the merger, JSL will become a single listed entity on the stock exchange, with the promoters holding approximately 57% of the shares, while the remaining 43% will be held by the public. According to the proposed structure, the travel business of JSL Lifestyle Limited, a domestic subsidiary of JSHL, will be merged into JSL. The non-motorized business will be divided into a new independent entity called Jindal Lifestyle Limited.

After the reorganization, Jindal Stainless Steelway Limited (JSSL) and Jindal Lifestyle Limited will operate as Indian subsidiaries, while JSL’s overseas operating subsidiaries in Spain and Indonesia will continue to operate as business units of the combined JSL. With the appointment date of April 1, 2020, the merger process is expected to be completed in the second half of fiscal year 22. The merger requires the approval of statutory bodies, shareholders, creditors and NCLT.

　　About Jindal Stainless Steel Co., Ltd.:

Jindal Stainless Limited is India’s largest stainless steel manufacturer with a production capacity of 1.1 MTPA. The state-of-the-art equipment of Jindal Stainless Steel Co., Ltd. is located in Orissa, eastern India. The plant includes a ferroalloy facility with world-class technology and equipment. The manufacturing plant equipped with mandatory power generation facilities can eventually be expanded to 3.2 MTPA for stainless steel production.

　　About Jinda Stainless (Hisar) Co., Ltd.:

Jindal Stainless (Hisar) Limited (JSHL) is a comprehensive stainless steel manufacturer with facilities ranging from melting, casting, hot rolling to cold rolling and other value-added services. The melt capacity of JSHL is 0.8 MTPA. It is also the world’s largest producer of stainless steel belts for razors and the largest producer of coin billets in India, meeting the needs of Indian and international mints. JSHL’s Special Products Department (SPD) meets the requirements of high-end precision and special stainless steels from well-known Indian and international customers.