Tata Steel UK acquisition talks only exploratory: JSW Steel
The Sajjan Jindal-led JSW Steel is not going to jump the gun on its buying interest in troubled Tata Steel’s British assets, saying talks are at an exploratory stage only, and it will be cautious in taking a call.
“JSW is an aspirational group. The deal talks are only at an exploratory stage. We are exploring the opportunities. We will keep in mind our financial ratios before going ahead,” JSW Group Chief Financial Officer Seshagiri Rao said.
He, however, added that the company has a strong balance sheet.
Last week, JSW Steel in a statement said it was evaluating some British steel assets, but did not name any specific target.
“As part of our growth strategy, we evaluate several opportunities, including the current opportunity of UK steel facilities,” JSW had said in an exchange filing.
“The Tatas, suffering from heavy losses for the past many years, had on March 29 announced its plans to sell its entire British steel operations in parts or full. The group has been hit by cheap Chinese imports, soaring costs and weak demand in the continent in particular and across the Western world in general,” reported by PTI.
JSW Group, with interests in steel, power, cement and ports, had a net debt of Rs 38,461 crore as of March 2016. It is interesting to see how the deal pans out as global demand for steel is expected to remain sluggish.
Global economy is still not out of the woods and IMF has again revised downwards its economic projections for global growth in 2016 to 3.2 per cent, saying economic activities across major regions/countries remain subdued despite sustained monetary easing.