Japanese steel giant JFE Steel Corporation will invest Rs 15,750 crore to form a strategic 50:50 joint venture (JV) with Sajjan Jindal-led JSW Steel, according to a regulatory filing.

The partnership will involve JSW Steel’s arm Bhushan Power & Steel Ltd (BPSL), including its integrated steel plant in Odisha. Under the agreement, the steel business of BPSL will be transferred to the joint venture through a slump sale with a cash consideration of Rs 24,483 crore. JFE Steel will invest in two tranches to acquire a 50% stake in the JV.

JSW Steel acquired BPSL in 2021 through the Insolvency and Bankruptcy Code (IBC) process, transforming the distressed 2.75 million tonnes per annum (MTPA) unit into a profitable company with an expanded capacity of 4.5 MTPA, currently employing 25,000 people.

The transaction will allow JSW Steel to monetise part of its stake in BPSL while accelerating its overall growth strategy. By bringing in JFE Steel as a long-term strategic partner, JSW aims to combine its strong project execution and operational expertise with JFE’s technological strengths to unlock additional value for the joint venture.

“Today’s announcement brings together JSW’s expertise in India with JFE’s technological strengths, enabling the joint venture to realise its growth potential and produce a variety of value-added steels,” said JSW Steel Joint Managing Director and CEO Jayant Acharya. Masayuki Hirose, President and CEO of JFE Steel Corporation, added, “By leveraging our technological strengths and jointly operating an integrated steel plant in India with JSW, we will contribute to the growth of both companies and the development of the Indian steel industry.” JSW Steel will continue its investment in BPSL and remain actively involved in creating value within the partnership, ensuring long-term growth and operational excellence.