How much is JSW Kalinga Steel planning to raise through bond issuance?

JSW Kalinga Steel is planning to raise approximately ₹9,500 crore through the issuance of unsecured, zero-coupon, five-year non-convertible debentures.

What is the purpose of the funds raised by JSW Kalinga Steel?

The funds raised will be used for the financing package of its 50:50 joint venture with Japan's JFE Steel, specifically for the Bhushan Power & Steel (BPSL) business acquired in a bankruptcy bid.

When is the repayment date for the JSW Kalinga Steel bonds?

The bonds will be redeemed at maturity in March 2031, with repayment made as a bullet payment.

Home / Business and Economy / JSW Steel Unit Eyes ₹9,500 Cr Bond Sale for JFE JV

JSW Steel Unit Eyes ₹9,500 Cr Bond Sale for JFE JV

18 Mar

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Summary

JSW Kalinga Steel plans to raise ₹9,500 crore via bonds.
This funds a joint venture with Japan's JFE Steel.
The bond issuance supports BPSL's acquired steel business.

JSW Steel Unit Eyes ₹9,500 Cr Bond Sale for JFE JV

JSW Kalinga Steel is set to raise about ₹9,500 crore by issuing unsecured, zero-coupon, five-year non-convertible debentures. This fundraising is a crucial component of the financing package for its 50:50 joint venture with Japan's JFE Steel, focused on the Bhushan Power & Steel (BPSL) business acquired through a bankruptcy bid. The bonds, rated AA by Crisil, are scheduled for redemption in March 2031, implying yields around 8.5%.

The proceeds will be channeled as shareholder loans to JSW Sambalpur Steel, which will acquire BPSL's steel operations via a slump sale. This entire structure is backed by joint letters of comfort from JSW Steel and JFE, along with security pledges. The Supreme Court's decision last September upheld JSW Steel's ₹19,700-crore resolution plan for BPSL, paving the way for this strategic JV formation. JFE Steel will invest ₹7,875 crore for a 25% stake in JSW Kalinga, with plans to acquire another 25% to establish the equal partnership.

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