JSW Steel Ltd is exploring options to rope in an investor to fund its stressed asset acquisitions, including the latest Bhushan Power and Steel, said sources familiar with the matter.

The flagship company of Sajjan Jindal-led JSW group is already has a debt of approximately Rs 39,600 crores, and the acquisition of Bhushan Power will add a significant cost burden to the steel-maker. Investors have been worried that the company’s debt would become unsustainable with more such stressed asset acquisitions.

The company has decided to pursue a ‘joint control model’ to fund all future acquisitions in the stressed space, in order to insulate the debt impact of these acquired assets on JSW Steel financials, the sources privy to the matter told CNBC-TV18.

CNBC-TV18 had earlier reported that a majority of Bhushan Power and Steel lenders had approved the resolution plan submitted by JSW Steel to acquire the company for Rs 19,700 crores, which was the highest offer among the three bids placed for the company. Other bidders, Tata Steel and Liberty house, had offered Rs 17,000 crore and Rs 18,500 crore, respectively.

The company had implemented a similar model when it acquired Monnet Ispat under the Insolvency and Bankruptcy Code (IBC) when it partnered with AION Investments.

Earlier this year, Aion Capital-JSW Steel consortium had acquired Monnet Ispat and Energy for Rs 3,875 crore, including Rs 1,000 crore as equity and working capital. JSW Steel has put in only Rs 375 crores in the form of equity/quasi-equity investments for the takeover, and the rest was financed by AION.

JSW Steel is looking to merge Monnet Ispat, and Bhushan Power, if the acquisition goes through the final stage, only post turnaround of these assets, the sources added.

JSW Steel is an integrated steel company with an installed steel-making capacity of 18 MTPA. When contacted, JSW Steel spokesperson declined to comment.