Sathavahana Ispat merges with Jindal Saw after latter pays full resolution amount
Successful resolution applicant Jindal Saw Limited has released the entire amount of Rs 694 crore for Hyderabad-based Sathavahana Ispat, the company informed the exchanges on 26 April 2023. Accordingly, Sathvahana Ispat stands merged with Jindal Saw in terms of the approved resolution plan as on 26 April 2023.
Jindal Saw was supposed to make the payment within 60 days from the date of approval of the resolution plan. The NCLT approved Jindal Saw’s resolution plan for Sathvahana Ispat on 31 March 2023.
In the exchange filing, the company further informed that the Monitoring Agency of the company at its second meeting held on 26 April 2023 approved the allotment of Equity Shares of the company to Jindal Saw Limited. The monitoring agency also approved the reduction of capital and cancellation of the existing equity shares (other than the shares allotted to Jindal Saw pursuant to the approved resolution plan) of the company. Sathavahana Ispat has become the wholly-owned subsidiary of the Jindal Saw.
The insolvency application against Sathavahana Ispat was filed by operational creditor Thirumala Logistics for failing to clear a due of Rs 1.25 crore.
Sathavahana Ispat Limited was a public limited company incorporated under the Indian Companies Act 1956 in 1989 with limited liability by shares. It was originally promoted by AS Rao, a first-generation entrepreneur and is at present a widely held company with its shares listed on the Indian premier bourses — BSE and NSE.
Sathavahana Ispat was primarily engaged in the manufacture and sale of (i) Pig Iron with a rated capacity of 210,000 tpa; (ii) Metallurgical Coke with a rated capacity of 450,000 tpa and (iii) co-generation cum thermal power of 50 MW. As a backward integration, SIL has set up a 2,98,800 tonns per annum sinter plant and 30Mw captive thermal power plant and as a forward integration has setup a 210000 tonns per annum Ductile Iron making plant.
Jindal Saw, which is engaged in manufacturing Submerged Arc Welded (SAW) pipes and Spiral pipes for various industrial Sectors, will utilize the available capacities of Sathavahana Ispat to increase production in order to benefit from the operating leverage. Due to the brand image and market goodwill of Jindal Saw with its major customers who have running projects across the country, it is in a position to book substantial orders for the unit of Sathavahana Ispat in a short span of time and thus making the plant carry out invoicing from the very first day of the start of commercial production.
Also See: Jindal Saw acquires Hyderabad-based Sathavahana Ispat for Rs 694 crore
