SAIL to sign pact with Steel Complex

Thiruvananthapuram: The State-owned Steel Complex will sign a joint venture agreement with the Central public sector Steel Authority of India (SAIL) on December 10.

The two companies will have equal equity participation in the joint venture. However, the management control will rest with SAIL.

According to a statement from the Industries Department, SAIL will invest Rs 50 crore in the venture in the first phase for setting up a TMT rolling mill at Steel Complex with an annual installed capacity of 65,000 tonnes. The joint venture, when fully commissioned, will have fresh investments to the tune of Rs 200 crore, according to a statement from the office of the Industries Minister.

The agreement will also envisage diversification into new products in future as part of the joint venture. It is expected that the turnover of Steel Complex will go up to Rs 70-80 crore at the end of the current financial year.

It is pointed out that Steel Complex was on the verge of closure during the reign of the previous government. At that time, the company was buying steel from other companies and converting them into products.

SAIL and Steel Complex had entered into a memorandum of understanding for financial and technical cooperation in June 2007. This paved the way for savings of 50 units of electricity per tonne of steel. Besides, the production capacity of the company went up to 55,000 tonnes using the two existing furnaces.

The increased production also raised the turnover of the company to Rs. 25 crore in 2007-08 from Rs. 14 crore in the previous year.