Japan’s JFE to acquire 50% stake in Bhushan Power &Steel

Move Seen as Part of Larger Strategy to Strengthen Balance Sheet and Forge Global Alliances

Bhubaneswar: JSW Steel is reportedly in advanced discussions to divest up to 50 percent of its ownership in Bhushan Power & Steel Ltd (BPSL), with Japan’s JFE Steel emerging as the frontrunner to acquire the stake. The potential sale, if finalized, could mark one of the most significant strategic partnerships in India’s steel sector, signalling JSW’s intent to realign assets, optimize capital deployment, and deepen global technological collaboration.

According to multiple sources quoted by CNBC-TV18, JSW Steel is exploring a mix of strategic and financial investors for the stake sale, with JFE Steel—a long-standing ally—leading the talks. The move comes amid a broader industry trend where large steel producers are forming global partnerships to boost efficiency, technology integration, and sustainable production practices.

JSW Steel acquired Bhushan Power & Steel (BPSL) in 2019 through India’s Insolvency and Bankruptcy Code (IBC) resolution process after a protracted legal battle. The acquisition gave JSW control over BPSL’s integrated steelmaking facility with a capacity of around 4.5 million tonnes per annum (MTPA), significantly strengthening its position in the eastern Indian market.

However, BPSL’s ownership became embroiled in further litigation. In May 2025, the Supreme Court ordered BPSL’s liquidation, a ruling that sent shockwaves through India’s corporate and legal circles. In a dramatic turn, the apex court reversed its decision in September 2025, reinstating JSW’s ownership and clearing the way for its revival plan.

With the legal uncertainties now settled, JSW appears to be recalibrating its long-term strategy for BPSL—seeking global collaboration to expand technological expertise and share financial exposure while accelerating the plant’s operational efficiency.

JSW Steel and JFE Steel share a decade-long partnership, with the Japanese steelmaker already holding a minority stake in JSW’s special steel ventures. JFE is known for its advanced technologies in high-strength steel and sustainable manufacturing processes—capabilities that JSW is keen to integrate across its Indian operations, particularly as it scales up green steel initiatives.

Industry analysts believe JFE’s potential entry into BPSL would strengthen the plant’s technological foundation and improve product mix diversification. The collaboration could also enable the introduction of advanced grades of steel catering to sectors like automotive, infrastructure, and renewable energy—areas that are expected to see strong demand growth.

In its official response to CNBC-TV18, JSW Steel stated: “Our strategy includes evaluating various opportunities, both organic and inorganic, in India and overseas – including potential collaborations aimed at enhancing scale, efficiency and global competitiveness. However, we would not like to comment on speculation.”

The statement reflects JSW’s cautious communication approach, even as the company actively explores ways to deleverage its balance sheet while funding its ambitious expansion plans. JSW has lined up over ₹60,000 crore in capex for capacity expansion and decarbonization initiatives, and a partial stake sale in BPSL could provide fresh liquidity to support these projects.

India’s steel sector is witnessing consolidation and renewed foreign interest, driven by the government’s infrastructure push and the global pivot toward low-carbon steelmaking. Experts view JSW’s potential partnership with JFE as a strategic move to secure advanced technology and strengthen global competitiveness amid growing international trade challenges and carbon emission regulations.

If the deal goes through, it could set a new benchmark for cross-border collaboration in the Indian steel industry, combining JSW’s operational scale with JFE’s technological prowess. For Odisha, where BPSL’s key plant is located, the partnership could translate into higher investment inflows, improved local employment, and upgraded industrial capabilities.

While both companies remain tight-lipped on the deal’s valuation or timeline, market observers suggest that negotiations could accelerate in early 2026—ushering in a new chapter for JSW’s eastern operations and reinforcing India’s emergence as a key player in global steel manufacturing.