Despite frauds, JSW Steel Chairman Sajjan Jindal says no plan to exit Bhushan Power & Steel bid

Mumbai: JSW Steel chairman Sajjan Jindal on Thursday said the company will not withdraw from or reduce the bid amount for Bhushan Power & Steel (BPSL), but reiterated the call for immunity from future litigations against the scam-tainted firm. JSW Steel, which has submitted a successful Rs 19,300-crore bid to take over Bhushan Power & Steel, has approached the NCLT for relief following two fraud cases filed by Punjab National Bank and Allahabad Bank against the company.

“The process of acquiring BPSL has taken an unduly long time but there is no plan to withdraw our bid. We are only asking that since inquiries are going on against the company and its ex-promoters, we want complete security from that. The court has to take a decision on that,” Jindal told reporters on the sidelines of the 25th AGM.

JSW Steel had put in a Rs 19,300-crore bid to take over BPSL. Tata Steel and Liberty House were also in the fray for the company which owes lenders over Rs 40,000 crore. JSW Steel joint managing director and group chief financial officer Seshagiri Rao said the latest IBC amendments are mainly towards protecting lenders. “But what about the resolution applicants, who have to face litigations from many corners, be it the creditors or the tax department or the government? We also need to look at the rights of resolution applicants. In many cases, there is a lot of litigation coming in after control has changed hands. But the applicant often has to face future litigation that can come from anyone. [caption id=“attachment_939171” align=“alignleft” width=“380”]  Sajjan Jindal. File photo. Reuters[/caption] “There is also a disturbing judgment from the Delhi High Court saying the Prevention of Money Laundering Act gets precedence over the IBC,” he averred. Rao further said, “we expect a clean company. In case of BPSL, we approached the NCLT for protection that the assets after change in control will not be accessed through any litigation. We are hopeful we will get the relief.” On the bid to acquire Asian Colour Coated Ispat, Jindal said, the matter is with the authority concerned and they are awaiting their approval, adding the lenders have already accepted their bid. On the fundraising plans, Jindal said the company will continue to borrow to fund its expansion plans. “Steel industry is cyclical. But we take investment decisions looking at the long-term. We are increasing our manufacturing capacities and at this moment there will be no debt reduction,” he said. The company also got shareholders’ approval to raise Rs 10,000 crore during the year to fund its expansion plans. JSW Steel has already plans to spend Rs 48,700 crore between FY18 and FY22 to expand capacity from 18 mt to 24 mt and also to modernise and expand downstream capacities. To strengthen its raw material sourcing, the company secured six iron ore mines recently and acquired facilities in the US and Italy and bought out Monnet Ispat & Energy jointly with Aion Capital.