Indian steel company discontinues acquisition talks over title ownership issues
India’s Jindal Group has aborted its planned $500m acquisition of Shadeed Iron and Steel in Oman after certain issues came to light regarding the facility, a statement released by the company said.
The company said that it had discovered a title ownership issue at the 1.5 million tonnes-a-year (t/y) steel plant due to transactions that had been already carried out with an unnamed British Virgin Islands-based company.
Jindal also stated that it had discovered a breach of agreement with the Sohar Port Authority regarding the land title and that the company that owns Shadeed, Abu Dhabi’s Al-Ghaith Holdings (AGH), had liabilities estimated at $50m with China Shougang and Ajwaa Gas.
Jindal has been pursuing the acquisition of Shadeed since it entered the race in March. Up until then Abu Dhabi’s Emirates Steel Industries (ESI) has submitted an offer for the plant and many had expected the state-owned company to buy the facility.
However, the new development may mean that ESI could resurrect its interest in Shadeed after dropping out of the race last week (MEED 10:05:10).
The news will come as a blow to Shadeed’s employees, who were hoping for a quick sale after reports that staff were not being paid by AGH and that commissioning had still not started at the plant.
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