Jindal Stainless today said the Punjab and Haryana High Court has approved the firm's plans to restructure businesses, a move aimed at boosting profitability and paring debt.
The High Court of Punjab and Haryana, pursuant to the hearing dated September 21, 2015 vide its oral judgment "...Has sanctioned the Composite Scheme of Arrangement among Jindal Stainless Ltd and Jindal Stainless (Hisar) Ltd and Jindal United Steel Ltd and Jindal Coke Ltd and their respective shareholders and creditors...," Jindal Stainless said in a BSE filing.
The company is in the process of obtaining a certified copy of the order of the High Court. The order copy will thereafter be filed with the office of Registrar of Companies, NCT of Delhi and Haryana, it added.
The company's rejig plan includes demerger and listing of a subsidiary on domestic bourses.
Reacting to the development, shares of Jindal Stainless today hit a 52-week high of Rs 49.85 a share on the BSE. It finally closed lower at Rs 48 per share, up by 8.35 per cent from its previous closing.
The objective of the scheme, which got board approval in December, is to unlock value for shareholders to increase profitability, reduction of debt and improvement of the serviceability of debt.
The steel maker has a debt of around Rs 8,500 crore, a company source said, adding that this will come down by Rs 5,000 crore post-restructuring.
Under the scheme, Jindal Stainless will demerge its ferro alloys and mining division and vest it with Jindal Stainless (Hisar). It will also transfer stainless steel making facilities in Hisar to Jindal Stainless (Hisar) for a lump sum consideration of over Rs 2,809 crore.
Jindal Stainless will transfer the hot strip plant in Odisha to Jindal United Steel by way of slump sale for Rs 2,412.67 crore, the company had earlier said.
The firm also had proposed to transfer its coke oven plant in Odisha to Jindal Coke by way of a slump sale for Rs 492.64 crore.
Once the rejig scheme becomes effective, Jindal Stainless (Hisar) would seek listing of its equity shares on both the exchanges and its global depository receipts (GDR) on the Luxembourg Stock Exchange.
