JSW Steel To Acquire 100% Stake in Saffron Resources

Mumbai, 18 July 2025: In a move to enhance its resource base and structural steel capabilities, JSW Steel Ltd (NSE: JSWSTEEL) has approved a series of key board decisions. These include a complete acquisition of Saffron Resources, an option to increase stake in JSW Severfield Structures Ltd (JSSL), and a ₹1,075 crore joint venture with the Andhra Pradesh Mineral Development Corporation (APMDC). The strategic announcements were made following the company’s board meeting held earlier today.

Following the company’s major strategic announcements, JSW Steel Ltd’s share price closed at ₹1,044.80, marking a gain of ₹10.60 or 1.02% on 18 July 2025 at 3:30 PM IST. The stock opened at ₹1,039.00, touched a high of ₹1,053.50, and dipped to an intraday low of ₹1,027.00. The positive sentiment reflects investor optimism surrounding the acquisitions and joint venture disclosures, as well as anticipation ahead of the company’s Q1 earnings call scheduled at 5:30 PM IST.

Full Acquisition of Saffron Resources to Bolster Raw Material Access

JSW Steel’s board has sanctioned the acquisition of up to 100% equity in Saffron Resources Private Limited, a company that owns 887 acres of land in Odisha. This move is designed to strengthen JSW’s presence in eastern India and secure long-term access to land and potential mineral resources in a mineral-rich region.

24.9% Optional Stake in JSSL to Expand Influence in Structural Steel Segment

The board has further approved the signing of a Share Purchase Option Agreement (SPOA) with the Severfield plc group, paving the way for JSW Steel to potentially acquire an additional 24.9% stake in JSW Severfield Structures Ltd (JSSL). This would increase JSW’s holding in the 50:50 joint venture to up to 74.9%.

Stake and Valuation Details

• Current stake: 50.0%
• Proposed additional stake: Up to 24.9%
• Total consideration: ₹235.10 crore
• Total shares (if exercised): 11,25,17,094 equity shares

Transaction Terms

• Price per share: ₹20.9
• Mode of consideration: Cash
• Deadline to exercise option: April 30, 2026

JSSL recorded a turnover of ₹1,014.2 crore in FY25, with operations spread across India and Saudi Arabia. By increasing its shareholding, JSW aims to consolidate its leadership in the structural steel space, a segment witnessing accelerated demand in infrastructure and industrial projects.

₹1,075 Cr JV with APMDC to Reduce Iron Ore Import Dependency

In a third strategic step, JSW Steel’s board approved a joint venture with Andhra Pradesh Mineral Development Corporation (APMDC) to jointly develop the Konijedu Marlapadu Integrated Iron Ore Project in Andhra Pradesh.

This JV includes the development of:

• A 5 MTPA iron ore mine
• A 5 MTPA beneficiation plant

The project is expected to replace approximately 1.3 million tonnes per annum of imported iron ore with domestically processed concentrate, reducing reliance on imports.

Joint Venture Structure

• Total capital outlay: ₹1,075 crore
• JSW Steel stake: 89%
• APMDC stake: 11% (free ride equity, no capital liability)

Additional Terms

• Board Composition: Proportional to equity; key matters require one director from each side to approve.
• Performance Guarantee: JSW Steel will provide an unconditional bank guarantee of ₹45 crore.

Board Meeting Details Confirm All Resolutions Passed

The board meeting was held on 18 July 2025, from 10:30 AM to 3:25 PM, during which all resolutions received approval. These decisions are aligned with JSW Steel’s broader goal of vertical integration, aimed at reducing external dependencies while expanding high-value capabilities in construction-grade steel.

JSW Steel Ltd is one of India’s foremost integrated steel producers and a flagship business of the O.P. Jindal Group. Listed on both NSE and BSE, JSW Steel operates an expansive portfolio of flat and long steel products and has a growing presence in international markets. The company’s strategic expansions reflect its ongoing commitment to strengthening India’s steel sector while securing self-sufficiency in critical resources.

REF: https://nsearchives.nseindia.com/corporate/jessydenny_18072025152916_SE_Dis-outcome_of_board.pdf

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