JSPL to launch transparent competitive bidding process for JPL divestment

Jindal Steel and Power Ltd had announced its divestment in Jindal Power Limited (JPL), its material subsidiary, in April. (Representative image)

Jindal Steel and Power Limited (JSPL), an industrial powerhouse of the country, has decided to launch an additional transparent competitive bidding process for the proposed stake sale of JPL.

The company had announced its divestment in Jindal Power Limited (JPL), its material subsidiary, in April.

The company had accepted a binding offer from Worldone Private Limited (acquirer) to divest its 96.42 percent stake in JPL. ".... has accepted a binding offer from Worldone, to divest its 96.42 percent stake in Jindal Power (JPL), a material subsidiary of the company," a press release had said.

The company has now negotiated an improved binding offer from Worldone, which it claimed to be “simple and straightforward where there will be no continuing financial linkage between JSPL and JPL post the divestment.”

“After various rounds of discussions and negotiations, JSPL and its transaction advisors have successfully negotiated a revised and improved binding offer (“Revised Offer”) from Worldone accommodating all of the investor feedback received by the Company,” it said in a filing at Bombay Stock Exchange (BSE).

The key highlight of the Revised Offer is that Worldone will buy out all the Equity Shares and Redeemable Preference Shares of JPL held by JSPL for a total consideration of approximately Rs 7,401 crore. Of these, Rs 3,015 crore will be payable by cash, and the remaining Rs 4,386 crore (approximately) will be payable by way of assumption and takeover of liabilities and obligations of JSPL in relation to inter-corporate deposits and the capital advances extended by JPL to JSPL, the company said.

The divestment is in line with JSPL’s strategic objective to continuously reduce its debt, focus on its India steel business and significantly reduce its carbon footprint by almost half as part of its ESG objectives.