India’s JSW Steel is planning to raise $1bn through an issuance of non-convertible foreign/local currency senior unsecured bonds. The proceeds from the issuance are expected to be used to fund the company’s acquisition of bankrupt steel firm Bhushan Power and Steel Ltd (BPSL) for INR 197bn ($2.7bn). While the acquisition of BPSL is likely to increase JSW’s debt, it will also lead to incremental EBITDA for the company. The company said via an exchange filing, “The Board has approved an enabling resolution authorising the Finance Committee for raising of long term funds through issuance of Non-Convertible foreign currency/Rupee denominated Senior Unsecured Fixed Rate Bonds upto USD 1 Billion, in one or more tranches, in the international market(s), either by the Company or by any of its domestic subsidiaries or overseas subsidiaries backed by corporate guarantee of the Company”. JSW Steel Ltd. is a subsidiary of the diversified $12bn JSW Group with interests in sectors including steel, energy, infrastructure, cement and sports. The company had reported a revenue of INR 193.29bn ($2.65bn), up 15% QoQ and net profit of INR 28,290mn ($388.2mn) for the quarter ended December buoyed by the increased steel prices. The company in its latest release revealed that it had reached a capacity utilisation of 96% and achieved a 2% YoY growth in the crude steel production in January.
JSW Steel’s bonds were flat. Its 5.95% 2024s and 5.375% 2025s were trading at 107.1 and 105.9 respectively.
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