According to latest reports, natural resources major, Vedanta group has renounced its plan to set up an integrated steel plant in Jharkhand amid its acquisition of Electrosteel Steels (which is also in Jharkhand) under the resolution process.
The Anil Agarwal-led company had signed a memorandum of understanding (MoU) with the state government of Jharkhand last year to build a 1 MnT integrated steel plant in the state that would have employed nearly 5,000 people. The plant was supposed to be set up in joint venture with JSMDC (Jharkhand Mineral Development Corporation).
However, Vedanta’s top official has confirmed the abandonment news and has quoted that Vedanta has dropped its plan to set up a new steel plant as it has completed the acquisition of Electrosteel in Jharkhand which is a good strategic fit (of adding value to their iron ore business) to create an integrated iron ore and steel business making.
In April 2018, Vedanta had acquired 90% stake in Electrosteel Steels under the resolution process at INR 5,320 crore which was to be paid via both debt and equity. Electrosteel Steels has a planned steelmaking capacity of 2.51 MnT and a commissioned capacity of 1.5 MnT in Bokaro district of Jharkhand.
Vedanta is one of the world’s largest global diversified natural resource majors, with operations across zinc-lead-silver, oil & gas, iron ore, copper, aluminium and commercial power. For more than five decades, it has been engaged in exploration, mining and processing of iron ore. The company’s operations are based predominantly in Goa, Odisha, Rajasthan, Chhattisgarh, Tamil Nadu, Karnataka, Punjab Gujarat and Andhra Pradesh.
In first quarter (Apr to Jun) of FY19, the company has posted a marginal increase of 2% in net profits at INR 1,533 crore whereas its revenues increased by 15% to INR 22,206 crore year on year basis.
Leave a Reply