Jindal Steel and Power Ltd (JSPL) will restructure the liabilities of its South African business and develop a plan to make it profitable, according to a regulatory filing. The company has decided to take the 'Business Rescue' route in efforts to revive the South African business, which primarily consists of Anthracite coal mine.
"With a view to protect the interests of various stakeholders and with a long-term vision of turning it profitable and sustainable, the company has taken the strategic decision to take the Business Rescue (BR) route," the company said in the filing.
Under the BR plan, JSPL will engage a business rescue practitioner who will look to restructure the liabilities - both operational and financial - as well as develop a plan to make the business profitable.
"The management is confident that by opting for the BR route, it can revive the business in South Africa and be able to increase its enterprise value in the long run," it added.
The size of revenues and operations in South Africa is miniscule in the company's global business portfolio, it said.
After its resurgence in India over the last year, through mix of divestments in India and overseas and through equity raising programme in 2017-18, the management has recalibrated its focus on the global ventures space, JSPL said.
"As part of the newly initiated International Portfolio Rationalisation plan, renewed focus has been brought to the mines & minerals assets across Australia, Asia and Africa," it added.
The assets are being rationalised keeping in view their long-term viability, the raw material security for JSPL and the profitability of each of these businesses.
"The Group has now endeavoured to take up each asset with a view of either exiting it or building it to add to the bottom-line," it said.
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