Nikkei reported that JFE Steel Corp said that it would look to boost its stake in India's JSW Steel Ltd should Indian rules on share purchases change in the future.

A JFE spokesman said that "Under current Indian rules, we cannot boost our stake in JSW without launching a tender offer bid. But should the situation change in the future, we hope to explore the option of raising our stake to above 15%.”

Mr Eiji Hayashida president of JFE told the Nikkei business daily in an interview on Sunday that JFE hopes to make JSW a so called equity method company within its group. He said that "I have told managing director Mr Sajjan Jindal about our intentions and we have had no negative response so far.”

Mr Hayashida also said in the Nikkei that JFE planed to join JSW's project to build a new integrated steel mill in India and that it was in talks with management on its ownership ratio.

Under equity method accounting rules, JFE could report part of the Indian company's net profit in its consolidated results if it holds more than 15% of its stock and has representation on its board of directors.

JFE last year bought 14.9% of JSW for USD 1 billion, just shy of the level that would trigger a mandatory public offering. The deal, aimed at gaining a foothold in the fast growing Indian market, marked JFE's first major capital investment in a foreign peer. A JFE executive already sits on JSW's board as an outside director.

(Sourced from moneycontrol.com)