Disinvestment of Neelachal Ispat Nigam Limited

On July 4, 2022, strategic disinvestment transaction of Neelachal Ispat Nigam Ltd (NINL) was completed.

Highlights

• The disinvestment transaction was completed by transferring 93.71 per cent stake of joint venture partners to Tata Steel Long Products Limited (TSLPL).
• Joint Venture partners of NINL had inked share purchase agreement (SPA) with TSLPL on March 10, 2022. It won the bid for acquisition of 93.71 per cent equity stake in NINL. It offered a price of Rs 12,100 crore.
• This payment has been utilised according to SPA for settlement of dues of employees, secured financial creditors & sellers and operational creditors, and for equity of selling shareholders.
• In the disinvestment process, two Odisha government PSUs like OMC and IPICOL respectively got Rs 1,246 crore and Rs 452 crore.

Conditions defined in the SPA

Strategic partners of NINL and six selling shareholders worked for satisfying a set of conditions that have been defined in the SPA. It includes certification of operational creditor’s dues, sellers operational & financial dues and employees dues. These conditions have been met mutually.

Neelachal Ispat Nigam Ltd (NINL)

NINL is a company promoted by Industrial Promotion and Investment Corporation of Orissa limited (IPICOL), MMTC Ltd, and other government agencies. NINL has its own captive power plant, for meeting the internal power requirement. It is exporting substantial quantity of power and is having its own captive iron ore mines. The company has turned out into India’s largest exporter of saleable pig iron since 2004–2005. LAM coke and Pig iron produced by NINL has established its acceptance in domestic and international markets.

Tata Steel Long Products (TSLP) ltd

It is involved in manufacturing high-alloy, value-added steel for diverse industrial use such as automotive, general engineering, railways, construction & infrastructure, and agriculture segments.

About Pig iron

Pig iron is commonly called as crude iron. It is an intermediate product of iron industry, while producing steel. Steel is obtained by smelting iron ore in blast furnace. Carbon content is very high in Pig iron, typically 3.8–4.7%. Other constituents include silica & constituents of dross. It is very brittle and not used directly as a material. Its applications are limited.

Month: Current Affairs - July, 2022

Category: Economy & Banking Current Affairs