Jindal brothers address Pope’s concern for Italian firm

New Delhi/London: Billionaire brothers, Naveen and Sajjan Jindal, could be the answer Pope Francis is looking for. Their companies, Jindal Steel and Power and JSW Steel, are in competing talks to buy parts of insolvent Italian steelmaker Lucchini, sources with direct knowledge of the matter said.

Pope Francis earlier this month called for those in power to use their “creativity” to resolve Lucchini’s problems. Italy’s second-largest steelmaker has tried to sell itself for years but has so far failed to attract investors, forcing it to recently begin idling capacity and putting at risk up to 4,000 jobs.

With Italy still struggling to emerge from its longest postwar recession and unemployment running at 13 per cent, the highest level since at least 1977, the shutdown of another piece of industrial infrastructure would underline the deep problems facing the euro zone’s third-largest economy.

For the Jindals, Lucchini would give them an opportunity to accelerate an expansion of their operations outside of India where steel demand growth has been soft. And they might not even have to fork out a fraction of the $5 billion that Forbes said the Jindal family is worth; heavy liabilities and a need to protect jobs mean Lucchini could be sold for just one euro, Italian media reports say.

Formerly owned by Russia’s Severstal, Lucchini was declared insolvent in 2012. “Our interest is very preliminary as of now but they have some mills that look interesting,” said a source at Jindal Steel. “I don’t think we will be too keen on their blast furnace.”

A JSW spokesman when contacted said that “as part of its growth strategy, the company looks to evaluate opportunities for growth, both organically and inorganically”.