Arcelor Mittal signs deal for $9 bln India plant
By Julien Ponthus
BRUSSELS (Reuters) - Arcelor Mittal, the world's largest steelmaker, said on Thursday it had signed an agreement to build a $9 billion plant in India to achieve its first foothold on the subcontinent.
The plant will have an annual production capacity of 12 million tonnes.
The company said it had signed a memorandum of understanding with the government of Orissa on setting up a steel-making operation in the Keonijhar district.
"We have always said that we want to have an operational presence in India. The Indian economy is demonstrating excellent growth and steel consumption is set to increase considerably in the future," said Chief Executive Lakshmi Mittal, an Indian-born billionaire who owns a majority stake in the company.
Arcelor Mittal said it would carry out a detailed project report based on the needs of the steel plant, looking into captive mining facilities, power and water supplies and the setting up of townships for employees.
Mittal Steel shares were down 0.4 percent at 31.81 euros while the DJ Stoxx European basic resources index was down 0.5 percent at 1530 GMT.
"It's been known about for two years so it's nothing very new," said Michael Shillaker, analyst at Credit Suisse.
The company said the greenfield steel plant project would be developed in two phases of 6 million tonnes each, with an investment of about 400 billion rupees ($9 billion).
"It is expected that the first phase would be completed within 48 months from the date of the submission of the DPR (detailed project report) and the second phase within a further 54 months after the completion of phase 1," the company said in a statement.
Arcelor shareholders earlier this year accepted a takeover offer from Mittal Steel, then led by Lakshmi Mittal, after an acrimonious fight between the two companies.
After the takeover is finalised around next April or May, Arcelor Mittal will be a global giant three times larger than its nearest rival.
BRUSSELS (Reuters) - Arcelor Mittal, the world's largest steelmaker, said on Thursday it had signed an agreement to build a $9 billion plant in India to achieve its first foothold on the subcontinent.
The plant will have an annual production capacity of 12 million tonnes.
The company said it had signed a memorandum of understanding with the government of Orissa on setting up a steel-making operation in the Keonijhar district.
"We have always said that we want to have an operational presence in India. The Indian economy is demonstrating excellent growth and steel consumption is set to increase considerably in the future," said Chief Executive Lakshmi Mittal, an Indian-born billionaire who owns a majority stake in the company.
Arcelor Mittal said it would carry out a detailed project report based on the needs of the steel plant, looking into captive mining facilities, power and water supplies and the setting up of townships for employees.
Mittal Steel shares were down 0.4 percent at 31.81 euros while the DJ Stoxx European basic resources index was down 0.5 percent at 1530 GMT.
"It's been known about for two years so it's nothing very new," said Michael Shillaker, analyst at Credit Suisse.
The company said the greenfield steel plant project would be developed in two phases of 6 million tonnes each, with an investment of about 400 billion rupees ($9 billion).
"It is expected that the first phase would be completed within 48 months from the date of the submission of the DPR (detailed project report) and the second phase within a further 54 months after the completion of phase 1," the company said in a statement.
Arcelor shareholders earlier this year accepted a takeover offer from Mittal Steel, then led by Lakshmi Mittal, after an acrimonious fight between the two companies.
After the takeover is finalised around next April or May, Arcelor Mittal will be a global giant three times larger than its nearest rival.
Source : Reuters
posted by anandsonline @ Friday, December 22, 2006
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