JFE Holdings,the second largest Japanese steelmaker, has announced its India investment to buy a 14.9 percent stake in India’s third largest steel manufacturer JSW Steel. The Japanese company has purchased just below the 15 percent norm so as to not trigger the open offer regulations.

JSW will issue fully convertible debentures of face value of Rs. 4,800 crore ($1.1 billion). Business Standard reports that the transaction will be completed in three tranches at a minimum share price of Rs 1,331 ($29.5) a share or a maximum of Rs 1,500 ($33.3) a share, depending on the stock’s performance. 

Amarchand's Delhi office advised JSW Steel with M & A and Banking Partner Gunjan Shah leading the team along with Puja Sondhi and Devottam Sengupta. Gunjan Shah said, “JFE is looking at long term plans for its investment in India. Since JSW is a publicly listed company there were hardly any issues related to due diligence, but comprehensive technology transfer agreements were executed between JSW and JFE”.

JSW is a long-standing client of Amarchand and the firm has advised on several high profile deals for the steel manufacturer including its $1 billion (Rs. 4,500 crore) acquisition of a US steel plant in 2007.

AZB’s Capital Markets Partner Shameek Chaudhuri advised the Japanese conglomerate, JFE and was assisted by Souvik Ganguly and Sonali Mathur. Speaking to Bar & Bench Shameek Chaudhuri said, “This is one of the big transactions where such a large investment is being made without change in control. Also nearly 16-20 technology transfer agreements were executed between JFE and JSW that will bring path breaking technology to India and will assist in the manufacture of automobiles”.