Eton Park buys 10% in JSW Infra for $125 mn

US-based hedge fund Eton Park Capital today acquired a 10 per cent stake in Sajjan Jindal-owned JSW Infrastructure for $125 million (about Rs 562 crore).

The unlisted arm of JSW Group, which operates two ports in Goa and Jaigarh, Maharashtra, will use these funds for expanding its port business and retiring some of its debt.

JSW Infra has debt of around Rs 500 crore, of which the company plans to retire around Rs 200 crore, taking its debt-equity ratio to 1:1, much below the industry average of around 3:1. The management believes the investment will take care of the company’s equity needs for the next two years.

“We do not see the need for further equity investment in the next few years. There will be sufficient cash generation in the next two years. We are not looking for an initial public offer unless the present state of markets changes significantly,” said N K Jain, chairman, JSW Infrastructure.

The company plans to double the capacity of its Jaigarh port to 20 million tonnes. The second phase expansion of this port, which will use 30-40 per cent of its capacity for importing coal for the group’s power plants, will cost Rs 1,200 crore.