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Jindal Steel increases stake in Gujarat NRE’s Australian arm

24 Aug 2012 Evaluate

Jindal Steel and Power (JSPL) have swelled its holding in Gujarat NRE Coking Coal (GNCC), the Australian subsidiary of Kolkata-based Gujarat NRE Coke, by 2.67% to 12.74% with an investment of Rs 43 crore. Earlier in May, JSPL had acquired 10.07% in the Australian company for Rs 135 crore.

In May, while purchasing stake in GNCC, JSPL had also signed a long term contract to buy 5 million tonnes of coking coal over a 10-year period from GNCC. It also has the option to increase its purchase further by an additional 5 lakh tonnes in a year.

GNCC is going to issue and allot a further 30,000,000 fully paid ordinary shares to Jindal Steel and Power (Mauritius) at $0.25 a share raising A$7,500,000. It has also finalized a further off take agreement with JSPL, whereby Jindal will have the option to acquire an additional 200,000 tonnes of coal annually from the company at a benchmark linked market price.

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