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JSW – DITH: “Partnering for Growth”

Tuesday, May 21, 2019

JSW Steel Limited, flagship company of the JSW Group (JSW/IN), and Duferco International Trading Holding S.A. (DITH/CH) have again aligned their strategic goals in a landmark USD 700 million 5-year Advance Payment and Supply Agreement (APSA) executed end of February 2019.

This unique financing structure provides JSW long term funding to complement its plans for future growth secured by committed exports of steel products to DITH. For DITH, the transaction assures a captive supply of various steel products from JSW over the term of the APSA. The transaction further cements the long-term relationship between the two groups which have partnered together during the past 15 years. The deal is the largest trade finance facility to have been arranged in the Indian steel sector. In the past, JSW and DITH have entered into similar trade financing arrangements on smaller scale but for a ­longer term, all of which were successfully executed and completed.
The deal has been arranged and financed by the global banks BNP Paribas, Citibank, Credit Suisse, ING, Mashreqbank, Natixis, Societe Générale, Standard Chartered Bank acting as Mandated Lead Arrangers and Bookrunners. The commitment of the financing partners reflects the strong confidence held in both JSW and DITH when taking into consideration a transaction of this size and terms.
Commenting on the transaction, Seshagiri Rao, JSW Group JMD and CFO, said: “The structured long-term trade finance transaction is an important deal in diversifying the sources of financing for JSW Steel. This not only enables JSW to raise funds at competitive rates, but also assures incremental volume of sales in export markets leveraging the wide spread global network of the DITH Group companies.” Commenting on the transaction, Matthew De Morgan, DITH Group CEO, said: “We are delighted to have concluded such a significant structured trade finance transaction; this corroborates our faith in the sustainability of steel trading, and indeed is a material statement of confidence in the reliability of our partner JSW. ”