JSW Steel buys Heidelberg Cement's Raigad grinding unit
New Delhi: JSW Steel has acquired Heidelberg Cement India's 0.6 million tonnes per annum (mtpa) cement grinding facility in Raigad, Maharashtra, "as a going concern on slump sale basis" for an undisclosed sum.
The two companies signed the Business Transfer Agreements for the acquisition on October 5, they said in their respective filings with the BSE.
"The transaction will be consummated only after obtaining all relevant approvals required under applicable laws," it further said but did not disclose the value of the deal.
The 'going concern principle' is the assumption that an entity will remain in business in the foreseeable future. In May 2013, both the companies had announced the deal, saying JSW Steel will acquire the Raigad cement grinding facility of Heidelberg Cement India in Maharashtra. The deal value was not disclosed then also.
JSW Steel had acquired the company through its now merged associate firm JSW Ispat Steel.
Announcing the deal, JSW Ispat had then said the acquisition would enable it develop a stable outlet for
evacuation of slag. Heidelberg Cement had termed the deal as part of company's philosophy of "divesting less strategic assets with lower margins", which would enable it to "focus on more strategic and key operations in Central India where the company had recently expanded its cement capacity from 2 to 5 MTPA".
Shares of both the companies were trading in green during the afternoon trade on the BSE. While JSW Steel scrip was up 1.06 per cent at Rs 782.25, Heidelberg Cement scrip was trading at Rs 35.80, up 0.28 per cent from its previous close.
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