Tata Steel Long Products has executed a Share Purchase Agreement with MMTC, NMDC, MECON, Bharat Heavy Electricals, Industrial Promotion and Investment Corporation of Odisha, Odisha Mining Corporation, President of India and Odisha Government to acquire 94 per cent in Neelachal Ispat Nigam for ₹12,100 crore.

Three companies, including JSW Steel, Tata Steel Long Products and the consortium of Jindal Steel & Power and Nalwa Steel and Power, had put in financial bids to buy NINL. TSLP emerged as highest bidder and the government approved sale of the company in January.

NINL has an integrated steel plant with a capacity of 1.1 million tonnes, at Kalinganagar, Odisha. Its revenue fell sharply to ₹24 crore last fiscal from ₹941 crore in FY20 and same in FY19 was ₹2,025 crore.

It has huge debt and liabilities exceeding ₹6,600 crore as on March 31, 2021, including huge overdues of promoters (₹4,116 crore), banks (₹1,741 crore), other creditors and employees. The company has negative networth of ₹3,487 crore and accumulated losses of ₹4,228 crore as of last fiscal.

“The total consideration of ₹12,100 crore reflects the enterprise value, from which the liabilities will be settled and the balance will be paid for acquisition of 94 per cent equity shares in NINL,” said Tata Steel Long Products.