India's JSW Steel is taking its time buying a share in Canada Teck's coal unit: Reports

22 Sep 2023 , 11:16 AM

According to a Reuters report, India’s JSW Steel Ltd. is delaying plans to acquire a share in Teck Resources’ steelmaking coal operation as the first indication that a diplomatic row is impacting trade relations.

As a result of a disagreement over the assassination of a Sikh separatist leader in the Canadian province of British Columbia in June, relations between India and Canada abruptly deteriorated.

According to a representative for the foreign ministry, India on Thursday stopped providing visa services to Canadians due to threats against its consular workers there.

The insider claimed that although negotiations on the equity sale had slowed, work on the paperwork had not. JSW Steel is the largest steelmaker by capacity in India.

The acquisition of a Canadian company by a foreign company would be subject to a national security review under the Investment Canada Act, according to Canada’s industry ministry, which oversees foreign investment deals.

According to news reports, JSW is in discussions with investment banks such as Standard Chartered and Deutsche Bank to acquire the finance for the deal.

One of Teck’s top clients in the coal business is JSW steel.

The Vancouver-based business has twice rejected Glencore’s unsolicited $22.5 billion offer to buy the entire company. ‘Various’ interested parties have made the corporation proposals for its coal business, it was reported in July.

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