DLA Piper advises JSW Steel Limited on strategic investment in Illawarra Metallurgical Coal

Global law firm DLA Piper has advised JSW Steel Limited (JSW), listed on the National Stock Exchange of India (NSE) and Bombay Stock Exchange (BSE), on a follow-on USD60 million strategic investment in Illawarra Coal Holdings Pty Ltd (IMC), through its wholly-owned subsidiary JSW Steel (Netherlands) B.V., increasing JSW’s effective look through interest from 20% to 30%.

IMC owns and operates the Appin and Dendrobium coking coal mines in New South Wales. IMC also holds an interest in the Port Kembla Coal Terminal.

This transaction follows JSW’s initial investment in IMC in August 2024, when it acquired a 20% effective interest for USD120 million. The additional investment increases JSW’s offtake entitlement under a market-linked offtake agreement and its obligation to contribute to deferred funding payable to South32 in consideration for selling IMC to a GEAR / M Resources consortium in 2024.

DLA Piper advised JSW on both its initial investment in 2024 and its follow-on investment in 2025, representing a total financial commitment of up to USD255 million. The investment structure provides operational visibility to JSW along with certain strategic rights, while preserving JSW’s entitlement to both life of mine offtake and upstream financial returns.

Commenting on the transaction, DLA Piper Corporate partner Alexander Samson said: “JSW’s investment is structured through complex, multi-layered joint venture arrangements. Collaborating with the JSW M&A and Legal teams, we provided strategic M&A advice to ensure JSW’s interests were appropriately represented and protected, and that its offtake rights are secured over the life of the mine.”

“These transactions reflect a detailed understanding of the priorities of strategic foreign investors, including the need to safeguard interests of all stakeholders and long-term security of supply,” added Alex.

JSW’s investment enables it to access premium Australian coking coal and supports its plan to increase steel output to more than 50 million tonnes per annum by 2031. Continued foreign investment in Australia’s resources sector, including coal, highlights Australia’s role in supporting industrial growth and development and the broader energy transition.