Miglani family, co-owners of Uttam Galva Steel is acquiring 24.5% stake in Lloyds Steel for R190Cr. The shares were bought through it's two group entities - Ultimate Logistics Solutions Pvt Ltd and Siddharth Holdings Pvt. Ltd.

Both the entities are owned by Ankit Miglani.

Lloyds Steel is also issuing 4,92,61,802 equity shares to SBI against part conversion of it's existing loan.

According to DNA, Lloyds currently requires close to R600Cr of working capital to run its steel plant and its cash flows cannot complement its need. The whole exercise of issuing equity shares will help the company raise close to R227Cr.

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The company had undertaken a similar exercise in November 2011, when it offered more than two crore shares to the Arcil. This had helped the company walk out of Arcil and restructure almost R1,500Cr of its debt.

Lloyds Steel opted for restructuring way back in 2001 when the debt on its books had swelled up to approximately Rs2,000 crore.
After it walked out of Arcil, it was left with a debt of R500Cr for which negotiations have been still under way. Arcil currently holds 11.64% shares in the company, which is expected to come down marginally after Lloyds infuses more shares under the current exercise to raise capital.

ET had reported last year that Uttam Galva may buy 32% stake in Lloyds Steel for R600Cr, however, both Lloyds Steel and Uttam Galva Group had denied the deal.

Last year in April, Miglani Family acquired Andhra Pradesh-based Bramhani Industries. The acquisition of Bramhani also included the 11,700 acres that the promoters own in Kadapa and a commitment on iron ore supply from Obulapuram Mines

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