ArcelorMittal Nippon Steel India, a joint venture between ArcelorMittal South Africa and Japan’s Nippon Steel, is reportedly in discussions with banks to secure a loan of about 85 billion rupees ($1 billion). The loan would be utilized for funding the firm’s expansion plans, making it potentially the largest local-currency loan in India for the year 2024.
Several lenders, including State Bank of India, ICICI Bank, and Axis Bank, are expected to participate in the syndicated deal. State Bank of India, being India's top bank, may contribute more than half of the loan amount. The loan will likely have a tenure longer than five years and could be priced against a local interest rate benchmark.
The purpose of the loan is to support ArcelorMittal Nippon Steel India's capital expenditure as it seeks to enhance its capacity. The potential loan comes amid expectations of increased infrastructure spending in India, driven by anticipated reelection of Prime Minister Narendra Modi.
Although the details of the lending facility are not finalized and may change, if the deal goes through, it would mark the largest rupee-denominated loan in India for the year 2024. ArcelorMittal Nippon Steel India, State Bank of India, ICICI Bank, and Axis Bank have not yet responded to requests for comments on the matter.
