JSW Energy, an unlisted subsidiary of the JSW Steel Group, is close to acquiring a significant equity stake in an Indonesian mining company. The move is in line with the company’s strategy of owning coal mines and lowering operating costs. JSW Energy is believed to have completed the due diligence and would complete the transaction soon. The company has declined to comment on specifics such as the percentage of equity and the size of coal reserves. Indonesia is known for having huge reserves of thermal coal used in power plants. The move is part of JSW Steel’s plans to meet raw material needs. Also on the anvil for a possible buyout is a coalfield in Mozambique and steel units with manufacturing capacities of 1-2 mn tonnes in Europe or North America. JSW is also eyeing coal assets in other African nations. With a view to facilitate its overseas buyouts, JSW has floated a subsidiary in the UK with a capital of £1 mn. On Monday, the board decided to further capitalize the UK subsidiary, set up to acquire steel companies overseas, by raising it to £7.5 mn. During this quarter, the company also registered JSW Natural Resources in Mauritius to be the pivot to acquire foreign coal assets.
The company is only looking at smaller capacities abroad. It is looking at 3-4 proposals in the downstream and service centre sectors that can service the requirement of global auto majors in the advanced markets. It is also a suitor for Sesa Goa, where Japanese trading major Mitsui plans to sell 51% and Mittal Steel is reported to be among the suitors (See Related Post).
Read the articles in The Economic Times and DNA Money
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