IISCO-SAIL merger gets cabinet nod

Cabinet today cleared the decks for merger of PSUs Indian Iron and Steel Company (IISCO) and Steel Authority of India (SAIL), authorising Ministry of Steel to initiate the process after getting approval of the Board of Industrial and Financial Reconstruction (BIFR).

"Cabinet today authorised the Ministry of Steel to permit SAIL to initiate the process of merger of IISCO with the steel giant after taking approval of BIFR," Union Finance Minister P Chidambaram said after a cabinet meeting chaired by Prime Minister Manmohan Singh.

This, he said, would ensure availability of high quality iron ore to SAIL's steel plants.

"With SAIL's financial and managerial capabilities and availability of potential with IISCO mines, collieries, large infrastructural facilities and good work culture, there would be greater synergy for capacity expansion and technological upgradation of the plant," he said.

Board of Directors of both SAIL and IISCO have already given in-principle approval to the merger.

IISCO is currently a SAIL subsidiary and after years of being in the red, made a profit of Rs 270 mn and has reported a provisional profit of Rs 400 mn during 2004-05.