Welspun Corp to Acquire Division of Demerged Welspun Steel Ltd
Welspun Corp announced that it will acquire the division of the demerged company Welspun Steel Limited, which is engaged in the manufacturing of Steel Billets and Direct Reduced Iron rebars manufacturing business. The scheme provides for demerger of the demerged undertaking and investments held in Welspun Specialty Solutions Limited (50.03%), Anjar TMT Steel Private Limited (100%) and Welspun Captive Power Generation Limited (2.95%). The company informed the exchange that the Board of directors of the company at its meeting held on June 28, 2021 has decided to propose the scheme of arrangement between Welspun Steel Limited and Welspun Corp to NCLT for transfer of WSL’s steel division to the company, subject to regulatory and other approvals.
In addition, the company stated “After a thorough due diligence by the Independent Agencies, the Board has decided to propose the Scheme of Arrangement to NCLT. The consideration of INR 362.73 crore will be paid through 6% Cumulative Redeemable Preference Shares, redeemable after 18 months from issuance date, and there will be no equity dilution for WCL shareholders.”
Welspun Steel Limited, established in 2004, is a privately held company, situated in Welspun City in Anjar. Welspun Steel Ltd. It manufactures rebars & billets. It has DRI Plant with 4 kilns, capacity 100 TPD each, a 12 MW Captive Power Plant attached to waste heat recovery boilers. It is implementing a Greenfield project for manufacturing of TMT bars. The company stated the expected project cost is INR 175 crore and the project is expected to be completed by September 2022. Besides, as a part of its steel division, WSL holds 50.03% shares in Welspun Specialty Solution Ltd, a listed company.