India Seamless plans Australian debut

To set up $275 mn plant with two foreign firms.

Indian Seamless Metal Tubes (ISMT) will set up a $275 million steel mill and seamless tube plant in Australia jointly with two other foreign companies. Pune-based company will have a 35 per cent stake in the project .

ISTM has recently signed a proposal for co-operation with Boulder Steel of Australia and the Breitenfeld Group of Austria for development of the project in Ipswich, in the northeastern state of Queensland.

The project is expected to produce about 3,50,000 tonne of seamless tubes a year, Boulder Steel informed the Australian Stock Exchange.

However, ISMT declined to comment on the project. When contacted a top official of ISMT said he would be in a position to comment on this only in next week.

Boulder Steel added in its communication to the stock exchanges that ISMT "has agreed to become a cornerstone investor in the project and can earn up to 35 per cent equity by providing technical and engineering services and by cash." ISMT has 'agreed' to market up to 1,00,000 tonne per year of seamless tubes produced by the project, it added.

ISMT and Breitenfield are the joint operators of the project and will provide detailed engineering, design, procurement and construction management for the project. The three companies have also agreed for a joint marketing of all three parties' products worldwide.

Other partners of the project include Australian Metal Recovery and the Queensland government. The former will provide about Rs 100 crore for the provision of scrap and slag handling facilities.

ISMT is the country's largest producer of seamless steel tubes with a capacity of 1,50,000 tonne per year.

The company is part of the Indian Seamless Group, which has a turnover of Rs 900 crore. Other two group companies include Indian Seamless Steel & Alloys and Taneja Aerospace & Aviaiton. The company scrip today close at Rs 86 at the Bombay Stock Exchange, down by 0.81 per cent.

The Breitenfeld Group is an Austrian privately owned steel producer. It is the fourth largest producer of speciality steel ignots and billets and has a production capacity of 1,25,000 tonne per annum.

Boulder Steel is a fabricator of structural and miscellaneous steel, provider of joist, deck, erection and detailing services.