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Mittals to run steel plant in Nigeria
Ishita Ayan Dutt in Kolkata |
August 20, 2004 08:35 IST
Global Infrastructure Holdings Ltd, a special purpose vehicle floated by P K Mittal and V K Mittal, has entered into an agreement with the Nigerian government for a 10-year technical and management contract to take control of the 2.2 million tonne Ajaokuta Steel Plant in Nigeria. The plant is primarily a long product plant, with facilities like sinter plant, coke oven battery, sponge iron plant and a captive power plant.
The overseas operations will lead to synergies of forward and backward linkages between Ispat Industries, the flagship company in the group and would also provide scope for better raw material logistics management across various plants.
With the Nigerian contract the total capacity of steel under the control of the Ispat Group was at 10 million tonne, globally. It was understood that the GIHL was eyeing further acquisitions as well as management contracts in some of the east European countries.
P K Mittal, chairman of Ispat could not be contacted and Ispat officials refused to comment stating confidentiality agreement. GIHL had also recently signed up to take controlling interest in a 2 million tonne Bulgarian plant, Kremikovtzi AD.
With the recent agreements, GIHL now has presence in countries like Nigeria, Bulgaria, Philippines, Libya and Bosnia. GIHL, which signed up to take over the shut down National Steel Corporation of Philippines early this year, had commenced production.
Renamed as Global Steel Works International Inc, it has a 1.5 million tonne hot rolling capacity and a matching 1.5 million tonne cold rolling and galvanising capacity along-with a tinplate line.
Industry sources said, it was strategically located to cater to both the domestic market of the Philippines and the export markets of ASEAN countries.
GIHL was also operating the state-owned Libyan Iron & Steel Company under a profit sharing lease agreement with the Libyan government.
GIHL has agreed to take up the production to 100 per cent utilisation of the rated capacity of 1.3 million tonne within a short period and then expand it further. LISCO also has 1.75 million tonne of sponge iron capacity.
While plans were on track to add capacities in most of the plants, Ispat in India was looking at a steel making capacity of 3.6 million by adding balancing facilities and technological re-engineering in the immediate future.