Jindal Stainless acquires remaining 46% stake in Chromeni Steels
Jindal Stainless Limited announced that its board has approved the acquisition of the remaining 46 per cent stake in Chromeni Steels.
Jindal Stainless Limited on Friday announced that its board has approved the acquisition of the remaining 46 per cent stake in Chromeni Steels. The acquisition is carried out for a cash consideration of Rs 277.90 crore, which included Rs 188.19 crore towards equity purchase and Rs 89.71 crore towards CSPL’s debt.
“We wish to inform you that the Board of Directors of the Company at its meeting held today, i.e. 14th June, 2024, considered and approved the acquisition of remaining 46 per cent equity stake in CSPL, thereby making CSPL a wholly owned subsidiary of the Company with effect from June 14, 2024,” the company said in a regulatory filing.
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CSPL has a cold rolling mill located in Mundra, Gujarat, with a capacity of approximately 0.6 MTPA. Earlier, the company had already acquired 54 per cent stake in Chromeni Steels through acquisition of 100 per cent stake of Evergreat International Investment Pte Ltd, Singapore (EIPL). The earlier acquisition of 54 per cent equity stake of Chromeni Steels was to enable Jindal Stainless to increase its cold rolled capacity in its product mix which will strengthen the company’s presence in the value-added segment in the long term. Now, the remaining 46 per cent acquisition will further help in better control, uniformity of policies and greater synergies between the two companies.
Earlier in May, Jindal Stainless earmarked a capex of Rs 4,700 crore for FY25, a majority of which would be used for its proposed expansion plans. The rise in capex, from Rs 3,800 crore in FY24, is also on back of expectations of a rise in domestic demand, said MD Abhyuday Jindal. The company posted a 30 per cent fall in consolidated net profit to Rs 501 crore for the fourth quarter, while its net revenue fell 3 per cent to Rs 9,454 crore and Ebitda slid 10 per cent to Rs 1,035 crore. The margins were under pressure on account of negative inventory valuation due to continuously falling nickel prices.