The company’s board of directors approved the demerger between NMDC and NMDC Steel Ltd.

NMDC told the media in an exchange filing that the Demerged Undertaking would be vested with NMDC Steel Limited according to the demerger.

The entire share capital of the NMDC Steel Limited held by the NMDC Limited would be cancelled, and new equity shares of NMDC Steel Limited would be issued to all the shareholders of NMDC Limited in the same proportion.

The scheme is subject to necessary regulatory and statutory approvals, including the approval of the Securities and Exchange Board of India (SEBI), the Ministry of Corporate Affairs, stock exchanges and respective shareholders and creditors.

NMDC is a government-owned company and is occupied with the exploration of a wide range of minerals. NMDC Steel Ltd is a fully-owned subsidiary of NMDC Ltd and does not have any business operations at present.

The Cabinet Committee on Economic Affairs gave its in-principle approval to the demerger and strategic disinvestment of NMDC Steel by selling the entire Government of India stake in the mill Steel to a strategic buyer in October 2020.

It has been planned by the Government of India to augment India's steel production to 300 million tonnes per annum (MTPA) by 2025. Green-field steel plants are being promoted through Special Purpose Vehicles (SPVs) in mineral-rich states of Jharkhand, Chhattisgarh, Karnataka and Odisha to fulfil the same.