SAIL plans $12 billion investments on its overseas projects

New Delhi: Steel Authority of India (SAIL) is planning four three-mtpa manufacturing facilities, one each in Indonesia, Mongolia, South Africa and Oman, at a cumulative investment of $12 billion.

The company has already signed the memorandum of understanding with the Indonesian government and are in constant dialogue with the governments in Mongolia, South Africa and Oman for setting up the three-mtpa steel plant.

The company is aiming to finalise all the plants in 2011-12. If all four plants are finalised, then the investment required would be at least $12 billion — $3 billion in each.

The proposed investments are likely to be financed in a 80:20 debt-equity ratio and the state-owned firm might rope in a strategic investor to part-finance the equity part.

SAIL will set up the facilities only if the local governments ensure that the requisite raw material and land is made available to the proposed plants.

SAIL intends to solicit the allocation of raw material assets in these countries in lieu of setting up the plants. It will use these assets to meet the demand of the proposed plants, as well as existing and future projects in India.