Southern Iron and Steel Company (Siscol), which was recently acquired by the O P Jindal group, today announced a Rs 580 crore expansion programme in two phases to hike capacity to one million tonne by December 2006.In the first phase, the Salem-based company's capacity will be increased from the present 0.2 million tonne to 0.6 million tonne by March 2006 at a cost of Rs 400 crore, Vijay Sharma, joint managing director and CEO of Siscol, said."In the second phase, the capacity would be further hiked by 0.4 million tonne to one million tonne by investing another Rs 180 crore," he said.The O P Jindal group took over the steel company by acquiring 51% stake held by the LMW group in Siscol as part of a restructuring plan approved by the lead banker ICICI.While Rs 120 crore will come in as equity from the Jindal group, the remaining Rs 360 crore will be funded through debt from the financial institutions, Sharma said. "There will be a tax-holiday for 18 months for the loan," he added.Siscol, which has accumulated losses of over Rs 430 crore, will be making nominal profits in the current fiscal, Sharma said, adding that the aim was to wipe out the entire losses in two years.Sajjan Jindal, one of the four sons of O P Jindal, who manages Jindal Iron and Steel Company (Jisco) and Jindal Vijaynagar Steel, has been entrusted with the management of Siscol, Sharma said.
