JSW Steel Unveils $1.68 Bln Fundraising Plan; Also Eyes Acquisition For Coking Coal

JSW Steel Ltd. unveiled plans to raise 14,000 crore rupees ($1.68 billion) and also agreed to acquire Mozambique-based Minas de Revuboe Ltda. (MDR) to secure coking coal.

The company’s board approved raising of long-term resources through issuance of debentures, shares and convertible securities, the Indian steel producer said in a recent stock exchange announcement.

JSW Steel will raise up to 7,000 crore rupees through non-convertible debentures with warrants, which are convertible into or exchangeable with equity shares of the company at a later date. In addition, the company plans to raise as much as 7,000 crore rupees through equity shares or convertible securities (other than warrants).

The company will issue these securities to qualified institutional buyers. The fundraising is subject to shareholders’ and regulatory approvals.

The latest fundraising plan comes as JSW Steel didn’t act on the earlier enabling resolution on raising of resources within the stipulated period of one year. As a result, the Mumbai-based company will seek a fresh approval from the shareholders at the upcoming annual general meeting to validate the resolution.

JSW Steel said the board has authorized its finance committee to decide on all matters related to the proposed issuances, including finalization and approval of the terms of issue.

SECURING RESOURCES

JSW Steel said as a step toward backward integration for augmenting captive sourcing of coking coal, its board approved the acquisition of up to a 100% stake in MDR, a registered Mozambican company.

MDR owns a high quality and large-scale pre-development stage premium hard coking coal mine project in the Moatize Basin of Tete Province in Mozambique, according to the statement. It is one of the largest pre-development stage premium hard coking coal projects globally and has JORC reserves in excess of 800 million tons. The project is yet to start operations.

The JORC Code provides a mandatory system for the classification of minerals exploration results, mineral resources and ore reserves according to the levels of confidence in geological knowledge and technical and economic considerations in public reports, according to its website.

Separately, JSW Steel said the company, through its wholly owned subsidiary JSW Natural Resources Ltd. agreed to acquire a 92.19% equity stake and shareholders’ loans of MDR for $73.75 million in cash, subject to closing adjustments.

The deal is subject to approval from Mozambique’s Ministry of Mineral Resources and Energy, and other conditions. The company expects the transaction to conclude by 31 January 2025.

CFO RESHUFFLE

JSW Steel said its board appointed Swayam Saurabh, who is currently the chief financial officer (designate), as CFO of the company with effect from 1 June.

Rajeev Pai, the existing CFO, will move to a new role within the organization and consequently, cease to be the CFO of the company from 1 June, it added.

Saurabh, a chartered account and graduate (B.com) from Banaras Hindu University, has more than two decades of experience across industries and geographies.

Before joining JSW Steel, he worked with Arvind Ltd. as CFO, according to the statement. Previously, he has been CFO of Hindustan Zinc Ltd. and ANI Technologies Ltd. (Ola), besides holding senior leadership roles at Royal Philips (APAC) and Asian Paints Ltd., it said.

Note: 83.3049 Indian rupees

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