JSPL climbs over 3 per cent on introducing transparent competitive bidding process for JPL divestment

The company has planned to put minority shareholders’ interests at the forefront of the decision-making process and decided to launch an additional transparent competitive bidding process for the proposed stake sale of Jindal Power Limited (JPL).

On Monday, Sensex & Nifty traded on a flat note at the start of the trading session. Jindal Steel & Power Limited (JSPL) caught investors' attention by zooming 4.12 per cent in the initial minutes of Monday's trading session. The company's introduction of a transparent competitive bidding process for JPL divestment has given a boost to the company's share price. 

The company has planned to put minority shareholders’ interests at the forefront of the decision-making process and decided to launch an additional transparent competitive bidding process for the proposed stake sale of Jindal Power Limited (JPL). The company has revised & updated the offer from Worldone after incorporating investor feedback received from the shareholders by the company. As per the revised offer, Worldone will buy out all the equity shares as well as redeemable preference shares of JPL held by JSPL for a total consideration of approximately Rs 7,401 crore, the breakup of which is Rs 3,015 crore payable by cash while the balance of approximately Rs 4,386 crore will be done by way of assumption and takeover of liabilities as well as obligations of JSPL in relation to inter-corporate deposits and the capital advances extended by JPL to JSPL. The revised offer contains no financial linkages between JSPL & JPL post the divestment, which was a key concern expressed by the investors in feedback sessions. 

A competitive bidding process will also be undertaken by the company to further protect the interest of minority shareholders in order to realise the highest value possible from JPL stake sale, using the revised offer of Rs 7,401 crore as the base offer. Additionally, the transparent bidding process will be advertised in the public domain and will offer an equal opportunity for interested bidders from around the world to contribute and improve or make better the present revised offer of Rs 7,401 crore. 

Jindal Steel & Power Limited is an Indian steel and energy company based in New Delhi, India. It is a leading player in steel, power, mining, oil & gas, and infrastructure in India. Meanwhile, Jindal Power Limited (JPL), a subsidiary of Jindal Steel & Power Limited, is one of India's leading power generation companies while its installed capacity is 3,400 MW. 

On Monday, the company's share traded 3.32 per cent up at Rs 410.95 at 10.15 am on BSE.