CCI clears proposed combination involving Bhushan Power and Steel, JSW Group and JFE Steel

The Competition Commission of India (CCI) has approved the proposed combination involving Bhushan Power and Steel Limited (BPSL), JSWSambalpur Steel Limited, JFE Steel Corporation and JSW Kalinga Steel Limited.

As per the approved proposal, BPSL’s steel business undertaking will be transferred to JSW Sambalpur Steel Limited through a slump sale. In addition, JFE Steel Corporation will acquire a 50 per cent direct shareholding in JSW Kalinga Steel Limited, which will result in an indirect acquisition of a 50 per cent stake by JFE in JSW Sambalpur Steel Limited.

Following the transaction, JSW Kalinga Steel Limited, and indirectly JSW Sambalpur Steel Limited, will be operated on a 50:50 joint venture between JFE Steel Corporation and JSW Steel Limited.

JFE Steel Corporation is part of the Japan-based JFE Group, which operates through three key companies—JFE Steel (steel business), JFE Engineering Corporation (engineering business) and JFE Shoji Corporation (trading business).

JSW Kalinga Steel Limited is a wholly owned subsidiary of Piombino Steel Limited, which in turn is a subsidiary of JSW Steel Limited. The company is yet to commence commercial operations. JSW Sambalpur Steel Limited, a wholly owned subsidiary of JSW Kalinga, is also yet to begin commercial operations and will own the transferred steel business undertaking after completion of the transaction.

At present, the steel business undertaking is owned by Bhushan Power and Steel Limited, a public limited company engaged in integrated steel manufacturing, including downstream processing of finished steel products. BPSL is currently an indirect subsidiary of JSW Steel Limited, held through Piombino Steel Limited.

The CCI approval clears the way for the restructuring and joint venture arrangement in line with competition norms.