JSW eyes buyout in Europe

JSW Steel, a part of the $4 billion OP Jindal group, is looking at acquiring a small value-added facility in Western Europe for around $2 million.

Sheshagiri Rao, director of finance, JSW, said, "The EU market is set to grow exponentially in the near future. For this, we are in the process of acquiring a firm that will help us cater not only to Europe, but the US as well."

The company intends to meet most of the investment through internal accruals and the balance through debt. The company's debt-equity ratio currently stands at 1:1.

The company's international sales until now are through direct exports. About 70 per cent of the 900,000 tonne of galvanised coils manufactured from the company's facilities in Tarapur and Vasind in Maharashtra are exported.

In addition, the company will expand the capacity of its Bellary plant in Karnataka to 10 million tonne per annum by 2010 from 3.6 million tonne at present. For this, the company has earmarked Rs 5,000 crore.

The Karnataka government and the company have reached an agreement for an allotment of 4,000 acre of land for the expansion of the project. The company, at present, is working at 90 per cent capacity and will try to achieve 100 per cent in the next three months.