Japanese steel maker Daido Steel Company will pick up 10 per cent stake in Maharashtra-based Sunflag Iron and Steel for around Rs 56 crore.
"...Board of Directors has approved issue and allotment of 1,80,21,945 equity shares of Rs 10 each at a premium of Rs 21 to Daido Steel Co., Japan on preferential basis," Sunflag Iron and Steel said in an exchange filing today.
Listed in Tokyo Stock Exchange, Daido Steel is one of the major alloy steel manufacturers in Japan. Incorporated in 1950, the company caters to auto components' makers in Japan.
Sunflag Iron and Steel has its steel-making facility at Bhandara in Maharashtra. The plant has a capacity to produce 3.6 lakh tonnes tonnes per annum of high quality special steel using liquid pig iron and sponge iron as basic inputs.
The sale proceeds would be used for strengthening capital base for the purpose of raising debt in future and to meet its capital expenditure among others, it said.
Promoters of Sunflag Iron and Steel had 54.51 per cent stake in the company as on June-end. Its shares settled at Rs 30.90 apiece today.
