Steel Authority of India Ltd (SAIL) will soon have a joint venture (JV) partner for its 300-acre steel special economic zone (SEZ) in Tamil Nadu. The state-run steel giant has initiated the process of scrutinising the expressions of interest (EOIs) received for the project.
BSE-listed IVRCL Infrastructure & Projects Ltd is one of the major real estate companies that is interested in it. Yesterday was the last date for receiving the EOIs. SAIL did not give the details of the companies which submitted EOIs.
The SEZ, likely to come up near the company’s Salem steel plant, is proposed to be implemented through a JV, in which SAIL will hold 26 per cent and the remaining by the JV partner. SAIL has already acquired the land, but it would require the final approval from the government after the formation of the JV.
“As India continues to attract investment in new capacity, exports of stainless steel are also likely to increase substantially in the next decade. There is a specific tender committee that is looking after the bids received,” an executive from SAIL, who did not want to be identified, told Business Standard.
Proximity to the Salem steel plant would facilitate seamless supply of stainless steel at competitive prices. “Besides, Salem steel plant and other SAIL plants can also supply mild steel items which may be required by the SEZ units to offer a wider range of products,” the executive added.
Last year, SAIL signed an MoU (memorandum of understanding) with IL&FS to form a special purpose vehicle (SPV) for developing the SEZ. However, the partnership failed due “lack of funding as the partners backed out”. KPMG is the advisor for SAIL’s SEZ project.
The Salem plant produces austenitic, ferritic, martensitic and low-nickel stainless steel in the form of coils and sheets.