KD Green Industries will merge with group company KD Iron & Steel Pvt Ltd as part of its strategy to expand its green manufacturing and infrastructure businesses.
The merger is expected to strengthen manufacturing scale, improve operational efficiencies, consolidate group businesses and enhance the balance sheet of the combined entity, a company statement said.
KD Green Industries has received the board’s in-principle approval for the said acquisition.
The proposed merger, subject to completion of due diligence and statutory approvals, is aimed at creating a diversified industrial entity with a focus on green manufacturing of value-added steel products, AAC blocks and infrastructure steel products catering to sectors such as power, railways and telecom.
Upon completion, furnace capacity is expected to increase to 1.8 lakh metric tonnes annually from 90,000 metric tonnes, while rolling capacity is projected to rise to 2 lakh metric tonnes annually from 99,000 metric tonnes.
The company said the proposed expansion and solar power project are expected to improve operating efficiencies and reduce energy costs.
KD Green Industries further said it has received approval for incentives from the Assam government aggregating around ₹600 crore over a period of 15 years, which are expected to support future expansion plans.
KD Iron & Steel, the flagship company of the KD Group, manufactures branded steel products under the XTECH brand and currently has an installed steel melting capacity of 90,000 metric tonnes per annum and rolling capacity of 99,000 metric tonnes per annum. It uses recycled metal scrap as a key raw material and electric induction furnace technology for steel production.
The company is also planning to set up a 25 MW captive solar power plant as part of its sustainability initiatives.
As part of its expansion plans, KD Iron & Steel is undertaking a capacity expansion programme involving an investment of around ₹325 crore.
