[Ferro-Alloys.com] JSW and JFE form ?15,750 crore joint venture to drive next-phase steel growth

The agreement transfers Bhushan Power & Steel’s Odisha facility into a new 50:50 partnership.

JSW Steel has entered into a joint venture with Japan’s JFE Steel valued at ?15,750 crore, marking a major restructuring of its asset portfolio. Under the arrangement, Bhushan Power & Steel’s integrated steel plant in Odisha will be transferred to the new JV, enabling both companies to build a dedicated platform for long-term growth.

Reshaping ownership and creating a new growth engine

As part of the transaction, Bhushan Power & Steel will be transferred to JSW Sambalpur Steel through a slump sale for ?24,483 crore. The company is fully owned by JSW Kalinga Steel, which operates under Piombino Steel. JFE Steel will acquire a 50% stake in JSW Kalinga in two phases totalling ?15,750 crore, resulting in an equal-share partnership between JSW Steel and JFE Steel.

JSW executives described the JV as a second growth engine that will enable Bhushan Power & Steel to scale beyond 10 million tonnes, supported by JFE’s global technical expertise and JSW’s operational capability.

Debt reduction to accelerate JSW’s expansion strategy

JSW Steel expects its debt to reduce by around ?37,250 crore by June 2026, driven by the cash inflow of ?32,358 crore and the transfer of ?5,000 crore of debt linked to the slump sale. The company views this deleveraging as central to strengthening its capital structure and unlocking further investment headroom.

The reduced debt burden will allow JSW Steel to speed up capital expenditure across its existing sites at Vijayanagar, Paradip, and Salav as it targets a production capacity of 43.4 million tonnes within three years and 50 million tonnes by 2030–31.

Bhushan Power & Steel, acquired through the insolvency process in 2019, has already seen significant investment under JSW’s ownership. The newly formed JV is expected to drive further capacity enhancements and growth beyond current targets, combining technical capabilities, operational discipline, and long-term planning.

• [Editor:tianyawei]