Bhushan Steel up by over 15% as ArcelorMittal looks forward for acquisition

Shares of Bhushan Steel spiked by over 15% as ArcelorMittal issued a letter of interest to acquire it

Oct 23, 2017 04:10 IST India Infoline News Service

Media reports that ArcelorMittal, the global steel giant, has exhibited interest in taking over Bhushan Steel. ArcelorMittal, headed by the billionaire Lakshmi Mittal, had issued an expression of Interest (EoI) for Bhushan Steel.

Following the news built up, the stock of the company rose by over 15% in the early trading hours of Monday.

Media reports state that the company is debt-laden, and has been referred by the Reserve Bank of India for liquidation under the Insolvency and Bankruptcy Code (IBC). The company had given up on the plan to set up a greenfield steel project in Odisha. This was due to the delay in acquisition of land and allocation of iron mines.

Bhushan Steel harbors a capacity to produce 5.6 million tonnes but is laden with a debt of Rs 44,478 Cr. The company holds a significant presence in auto steel categories.

By planning the acquisition, ArcelorMittal is eyeing for an opportunity to set foot in the Indian Steel Industry.

Bhushan Steel Ltd is currently trading at Rs 68.4, up by Rs 10.2 or 17.53% from its previous closing of Rs 58.2 on the BSE. The scrip opened at Rs 65 and has touched a high and low of Rs 69.8 and Rs 64.05 respectively. So far 63.11 lakh (NSE+BSE) shares were traded on the counter.

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