Barings to pick up 20% in Bhushan Power for $33m

MUMBAI: Barings Asia is close to buying about 20% in the Delhi-based Bhushan Power and Steel (BPSL) for $33m (Rs 152 crore). BPSL, a part of Bhushan Group, is raising funds to finance its expansion projects, including a 1.2m steel plant in Orissa. The deal is expected to be signed in two weeks’ time, investment bankers familiar with the matter said.

Arun Agarwal, vice president (finance) of BPSL, agreed that the company is in negotiations with Barings Asia to offload stake, but refused to divulge any details. “The details are still being worked out,” he said. Both Sanjay Singal and Neeraj Singal, directors of BPSL, were unavailable for comments, while a senior company official said, “Sanjay is out of the country.”

Sources said following the deal with Barings Asia, BPSL is expected to hit the primary market and go public in a year. Currently, it is wholly-owned by the promoters’ family. Sources said Sanjay Singal is expected to continue to hold majority stake in the company.

Brij Bhushan Singal, their father, is the chairman of BPSL and the listed group company — Bhushan Steel & Stripes (BSSL). Bhushan Power & Steel (BPSL) is into basic steel-making and has facilities in Chandigarh and West Bengal. Bhushan Steel and Strips (BSSL) is a secondary steel and auto-grade steel producer and has plants near Mumbai and Delhi. Incidentally, both the companies have projects coming up in Orissa.

Bhushan Power and Steel, formerly Bhushan Ltd, is a merged entity of Bhushan Industries, Bhushan Metallics and Decor Steel, having turnover of more than Rs 2,000 crore. It is a leading manufacturer of flat, round and value-added products in steel. Currently, it has seven plants at Chandigarh, Derabassi, Kolkata and Orissa. It has commissioned an integrated plant under phase-I in Orissa while the second phase is all set for takeoff.