Vardhman Industries will be selling 50% stake in Vallabh Tinplate (VTPL) to JSW Steel whereby the latter will be acquiring the stake in VTPL which is a company promoted by Vardhman Industries (VIL) and its promoters. The existing shareholders of VTPL shall continue to hold 50 % stake in VTPL. VTPL has a second largest manufacturing facility of tinplate in India.
Besides, JSW Steel has entered into a legally binding Share Purchase Agreement and Shareholders Agreement with the existing shareholders of VTPL to acquire 50% equity stake, post the closing of the transaction, JSW Steel will have representation in the board of VTPL proportionate to its equity holding.
The above transaction is going to be beneficial for VTPL as VTPL will have consistent supply of quality raw materials as well as leverage on the marketing and brand strength of JSW Steel. JSW Steel is a leading player in Indian steel industry with an installed capacity of 14.3 million tonnes.
