Steel Authority of India Limited (SAIL) and Tata Steel Limited (Tata Steel) signed an agreement at New Delhi today to establish a 50:50 joint venture company (JVC) for coal mining in India. The joint venture agreement was signed by Mr. S.K. Roongta, Chairman, SAIL, and Mr. B. Muthuraman, Managing Director, Tata Steel in the presence of other senior executives from both companies.
The JVC will identify, acquire and develop coal blocks in India. Four suitable medium coking coal blocks in the State of Jharkhand with reserves of around 600 million tonnes are under evaluation for this purpose by a joint working group of SAIL and Tata Steel. On allotment of the blocks, the JVC will develop and carry out mining operations for the captive use by SAIL and Tata Steel. Both the companies are expanding their steel making capacities and require secure sources of key raw material inputs like coking coal.
At the signing ceremony, Mr. Roongta said: "As India's steel industry enters a high and sustainable growth phase, raw material availability has assumed critical importance. In order to ensure security of coking coal supplies, it is imperative to augment indigenous coking coal availability. With both SAIL and Tata Steel having distinct strengths in coal mining, this JVC will generate synergy to ensure security of coking coal supplies for both partners. "
On his part, Mr. Muthuraman stated: "India has very limited reserves of hard and semi soft coking coal. With the Indian steel industry poised for a robust growth, it is imperative for us to utilise this scarce resource in the best possible manner. Both SAIL and Tata Steel have unique strengths and capabilities and we see a strong case to synergise these complementary strengths through this joint venture."
About SAIL
Steel Authority of India Limited (SAIL) is India's leading steel producer with a turnover of over Rs. 39,000 crore. A fully integrated iron & steel maker, it is ranked among the top five profit making companies in India. SAIL manufactures and sells a broad range of steel products, including hot/cold rolled sheets/coils, galvanised sheets, electrical sheets, structurals, railway products, plates, bars & rods, stainless steel and other alloy steels. SAIL produces iron & steel at five integrated plants and three special steel plants, located principally in the eastern and central regions of India and situated close to domestic sources of raw materials, including the company's captive iron ore, limestone and dolomite mines. For further information, please visit www.sail.co.in.
About Tata Steel
Established in 1907 as Asia's first integrated private sector steel company, Tata Steel* in 2006 on a combined basis is the world's sixth largest steel producer in terms of actual crude steel production with geographic footprints in India, South East Asia, UK and Europe. With the recent acquisition of Corus Limited, the combined enterprise has an aggregate crude steel production capacity of around 28.1 million tonnes with approximately 82,700 employees across the four continents. For further information, please visit www.tatasteel.com .
* The Company is undertaking an offer on a rights basis of its equity shares and cumulative convertible preference shares which has closed on 22nd December 2007 . The Letter of Offer is available on the website of SEBI at www.sebi.gov.in and the respective websites of the BRLMs at www.jmfinancial.in, www.citibank.co.in and www.dspml.com.
SAIL and Tata Steel form JV for coal mining in India
Mr. S.K. Roongta, Chairman, SAIL, and Mr. B. Muthuraman, Managing Director, Tata Steel shaking hands after signing the JVC agreement for coal mining today