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NMDC to invite new EOI with more stake for Chhattisgarh steel project

Last Updated: Friday, April 19, 2013 - 17:27

New Delhi: After failing to catch the fancy of global biggies with the 49 per cent equity offer in the Rs 15,525-crore steel project in Chhattisgarh, NMDC will soon invite a fresh round of Expression of Interest, dangling the carrot of more stake.

"We got just two applications in response to the EoI that we had issued in February. We want wider participation for the steel project from across the world. Hence, we will issue a fresh EoI and hike equity offer," a company official told PTI.

A decision on this regard would be taken at the company's next Board meeting, slated for April itself, he said, adding that EoI would be invited by early next month.
NMDC had invited EoI from world's leading steel makers to become a a joint venture partner for its three million tonnes per annum (mtpa) steel plant, 30 per cent work on which has already been completed.

However, the state-owned iron ore miner received just two applications, as on April 12, the last date for responding to the EoI. Identity of interested parties was not immediately known.

An industry expert said NMDC should have thought about consequences of its 49 per cent stake offer much earlier, particularly when its own tie-up with Severstal failed to make no headway because of the management control issue.

"Who will tie up with NMDC when it is not willing to give majority stake in the project? NMDC does not have experience of steel-making. Only iron ore does not make steel!," he said.

NMDC wanted its joint venture partner to stay put on a long-term basis for its successful operation and maintenance.

The Rs 15,525-crore project cost was envisaged to be financed in 1:4 debt-equity ratio. NMDC's maiden venture into steel is scheduled to be commissioned by September, 2015.

The company hopes the partner will bring in necessary technologies capable of producing high-end steel products like CRGO, CRNO and auto-garde steels which India mostly relies on imports to meet the domestic demand.

The company which would ensure uninterrupted coking coal supply would be given preference, NMDC had said.


First Published: Friday, April 19, 2013 - 17:27
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