JFE Steel and JSW Steel Complete Acquisition of thyssenkrupp Electrical Steel India
In a major strategic move, JFE Steel Corporation and JSW Steel Limited have successfully completed the acquisition of thyssenkrupp Electrical Steel India Private Limited, an Indian manufacturer and seller of electrical steel sheets. The acquisition, finalized on January 30, 2025, is a key development in the joint venture between JFE Steel and JSW, aimed at capturing the growing demand for grain-oriented electrical steel in India.
This acquisition allows the joint venture to enter the Indian market for GOES earlier than initially planned, with full-scale production of J2ES (JSW JFE Electrical Steel Private Limited) now set to begin earlier than the previously scheduled fiscal year of 2027. This proactive move positions the partnership to address medium- to long-term demand for GOES in India, which is expected to see significant expansion in the coming years.
Key Aspects of the Acquisition and Strategic Partnership
The acquisition brings together the expertise of JFE Steel and JSW Steel, two leading players in the global steel industry. Their deepened partnership, initiated in 2009 with the signing of a strategic comprehensive partnership agreement, has been a driving force behind the growth of their joint operations, particularly in India. The partnership has already made substantial progress in capital participation, providing technical solutions for automotive steel materials, and transferring advanced technology for environmental measures and electrical steel sheets.
New Joint Venture: JSW JFE Electrical Steel Private Limited (J2ES)
Following the acquisition of tkES India, the joint venture will operate under the name JSW JFE Electrical Steel Private Limited. The company’s primary focus will be on the manufacturing and sales of grain-oriented electrical steel. This acquisition not only helps JFE and JSW consolidate their presence in the growing electrical steel market in India but also ensures that the joint venture will have an integrated system from manufacturing to sales at an early stage.
The strategic acquisition will enhance the joint venture’s ability to meet the rising demand for electrical steel sheets, a crucial material used in the production of transformers, motors, and other electrical equipment, especially with the push for electrification in India’s rapidly developing energy sector.
Location, Shareholding, and Financial Details
The new company, J2ES, will be headquartered in Nashik, Maharashtra, India, a strategic location that is expected to enhance the efficiency of operations and distribution within the country. The shareholding ratio of the joint venture is equally split between JFE Steel Corporation (50%) and JSW Steel Limited (50%), showcasing the deepened commitment and collaboration between both companies.
The acquisition price for tkES India was set at 71 billion yen, reflecting the importance of this acquisition in both companies’ strategies for growth in India and beyond.
Expansion and Future Outlook
This acquisition significantly boosts the joint venture's ability to meet the increasing demand for electrical steel in the Indian market, a country undergoing a major industrial transformation with increased electrification and infrastructure development. The Indian market for GOES is expected to expand significantly due to the rise in renewable energy sources, electric vehicles, and overall industrialization, which requires advanced electrical components.
By early production of J2ES and establishing an integrated system from manufacturing to sales, JFE Steel and JSW Steel are positioning themselves as key players in meeting the future needs of India's energy sector. This acquisition underscores their commitment to sustainable growth and long-term success in a rapidly changing market.
Conclusion
Through the acquisition of thyssenkrupp Electrical Steel India, JFE Steel and JSW Steel have strengthened their collaboration and established a solid foundation for meeting the rising demand for grain-oriented electrical steel in India. This joint venture will not only enhance the competitiveness of both companies in the electrical steel market but also play a crucial role in supporting India’s growing electrification and industrialization needs.
