Jsquare Electrical Steel Nashik to Acquire Thyssenkrupp Electrical Steel India for Rs 4,051.40 Crore

Jsquare Electrical Steel Nashik has agreed to buy all equity shares of thyssenkrupp Electrical Steel India (tkES) for Rs 4,051.40 crore. This was revealed in a regulatory filing. Jsquare is a subsidiary of JSW JFE Electrical Steel Private Limited, a joint venture between JSW Steel and Japan's JFE Steel Corporation.

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The acquisition aligns with JSW Steel's strategy to boost its value-added steel products. The board of JSW Steel approved the plan to acquire tkES with JFE Steel Corporation. This purchase includes the acquisition of tkES India's equity and the technology package from thyssenkrupp group entities.

Consortium Wins Bid for tkES India

Thyssenkrupp announced that the India-Japanese consortium won the bid for tkES India. The transaction is expected to conclude in the coming months. The consortium will acquire thyssenkrupp's Indian electrical steel business for approximately 440 million euros, equivalent to Rs 4,051.40 crore.

The sale is driven by strategic market reasons. Dennis Grimm, Spokesman of thyssenkrupp Steel's Executive Board, explained that supplying raw materials from Germany to India is costly and affects competitiveness. "Setting up our own local raw material production is not economically feasible for us," Grimm stated.

Strategic Market Reasons Behind Sale

Grimm further elaborated that achieving economies of scale similar to local competitors is challenging when supplying from Germany. "This is why the sale is the right step for us at the right time," he added. The decision reflects thyssenkrupp's focus on maintaining competitiveness in India.

tkES India operates in manufacturing and selling grain-oriented electrical steel from its Nashik facility in Maharashtra. In FY24, it reported a turnover of Rs 1,271 crore, highlighting its significance in the electrical steel market.

The acquisition by Jsquare Electrical Steel Nashik marks a significant move in the steel industry. It underscores JSW Steel's commitment to expanding its portfolio with high-value products while addressing market dynamics effectively.