The Silicon Review ^Asia

With the intent to acquire 5.6 million tonne Bhusan Steel, Tata Steel took a debt of around Rs 17,500 crore in the first quarter of FY18 thus taking its debt amount to a total of Rs 1,16,615 crore. The acquisition was carried out by offering Rs 35,200 crore and Rs 1,200 crore to the lenders and operational lenders respectively. In addition to that, Tata Steel has also consented to buy Usha Martin’s steel business for Rs 4,700 crore. According to a recent finding, the company intends to coordinate its offer price with that of JSW Steel for Bhusan Power & Steel, it will probably change its bid to Rs 19,700 crore from its prior bid of Rs 17,000 crore.

After the acquisition of Bhusan Steel and Usha Martin, Tata Steel’s production capacity will reach to 19.3 MT.Tata is also in the plans to include 5MT Greenfield expansions. Including the 3.5 MT capacity of BPSL, Tata’s production capacity will increase to 27.8 MT, but at an expense of extra Rs 45,000 crore. On the other hand, JSW Steel partnered with Aion Capital and bought the 1.5 million tonne Monnet Ispat and Energy for Rs 3,875 crore. The acquisition brings its production capacity to 19.5 MT, and the steel maker will build more 6MT Greenfield capacity.

Other major players in this sector too are pursuing higher ambitions, like the Vedanta group through its acquisition of the Electrosteel Steels for Rs 5,320 crore through the insolvency process. ArcelorMittal, the Luxembourg based steel manufacturing company, has prepared a Rs 42,000 crore resolution plan for Essar Steel. It will also make a Rs 7,469 crore payment which will be used to clear the dues of Uttam Galva and KSS Petron.