Arm restructuring to reduce debt to below Rs 5000 cr: JSL

Jindal Stainless expects its debt to be
reduced to less than Rs 5000 crore as a
result of the restructuring move
undertaken by the company, says Jitender
Pal Verma, Executive Director and CFO.
In an interview to CNBC-TV18’s Latha
Venkatesh, Pal said the company will go
in for a slump sale of Jindal Stainless
Hisar, which will be demerged and listed
separately.
Shareholders will get one share of Jindal
Stainless Hisar for every share held in
Jindal Stainless.
Also read: Jindal Stainless gets board
nod to rejig biz; to list arm
Below is the transcript of Jitender Pal
Verma’s interview with Latha Venkatesh &
Sonia Shenoy on CNBC-TV18.
Latha: Can you take us through the
contours of the business reorganisation
and the asset monetisation plan that you
have laid out?
A: Jindal Stainless’ board has decided
that we would do a demerger of Jindal
Stainless into our subsidiary which will be
known as Jindal Stainless Hisar Limited
and subsequent to the demerger, we
would do a slump sale of our Hisar
Stainless unit.
Subsequent to that there would be a
second slump sale of HSM unit into
company called Jindal United Steel
Limited and yet a third slump sale of Coke
Oven into Jindal Coke Limited. So there is
one demerger and three slump sale, all in
a composite scheme which we have
proposed and we would be making the
disclosures to stock exchanges.
Sonia: Focusing on the demerger part a
bit – how many companies will be listed
going ahead?
A: Jindal Stainless Limited will be
demerged into one another legal entity
Jindal Stainless Hisar Limited and the
slump sale would happen in these three
legal entities. So demerger is only one
stepand the resultant demerged entity
would be listed and each shareholder as
on the record date once the scheme gets
approved after that there will be a record
date, so each shareholder as on that
record date would get 1:1 share in Jindal
Stainless Hisar Limited as well.
Latha: How much will you get for all those
three sales and what happens to your debt
after the sale?
A: Jindal Stainless will make the first
slump sale to Jindal Stainless Hisar
Limited – that value would be around Rs
2,809 crore and the second slump sale
Jindal Stainless will make to Jindal United
Steel Limited of the HSM unit that HSM
business undertaking – would be roughly
Rs 2,413 crore. The third slump sale
would be made of the Coke Oven
business undertaking to Jindal Coke
Limited, which will be roughly about Rs
493 crore.
Sonia: What is the total debt currently and
how much will it come down post the
slump sale?
A: Jindal Stainless today has little over Rs
8,500 crore debt and we expect the debt
to come down by over Rs 5,000 crore. So
there will be a reduction of debt.