Shares of Uttam Galva increased by 16 per cent to Rs 122 on Wednesday on unconfirmed news that ArcelorMittal plans to buyout the entire stake of the promoters. Currently, Lakshmi Mittal-owned ArcelorMittal owns 33.80 per cent stake in Uttam Galva, while the promoter Miglani family has 37 per cent.

Denying the development on ArcelorMittal hiking stake, Ankit Miglani, Managing Director, Uttam Galva, said there is no such proposal, as of now.

In 2009, ArcelorMittal acquired a stake in Uttam Galva, one of the largest galvanised steel producers. The Mittals have picked up a stake in Uttam Galva after their attempt to set up a steel plant in India hit a wall.

Uttam Galva runs one million tonne of specialised steel products mill in Maharashtra. It imports the vital hot-rolled coil to make galvanised steel, which is used by automobile customers.

The Miglani family seems to have moved forward since it struck the deal with the Mittals. Last year, Ultimate Logistics Solutions and Metallurgical Engineering and Equipment, the family-owned companies, acquired controlling stake in Lloyds Steel in a corporate debt restructuring process initiated by banks.

It had invested Rs 647 crore (including the open offer of Rs 77 crore) for buying out 58.35 per cent in Lloyds Steel, which has a steel production capacity of one million tonnes per annum.

In 2011, Miglanis bought over Brahmani Industries’ steel plant in Andhra Pradesh and renamed it Uttam Galva Ferrous. Uttam Galva, the listed entity, was not involved in both these deals and was executed through privately held companies of the family.

suresh.iyengar@thehindu.co.in

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