Financial Daily from THE HINDU group of publications
Saturday, Nov 27, 2004
MetalJunction goes for a changeover
Pratim Ranjan Bose
Kolkata. Nov 25
FROM next month onwards, the Rs 2,135-crore MetalJunction.com Pvt Ltd will be a public limited company re-christened MetalJunction Services Ltd.
The registrar of companies had approved the company's application, said MetalJunction Managing Director, Mr Viresh Oberoi.
"We will obtain the shareholders' approval through an extraordinary general meeting scheduled for this month. The rest of the formalities will be completed by the middle of December," he said.
While, for the moment, the changeover to a public limited company would not cause a qualitative change in the company's share capital or shareholding pattern, "going public would open several options," Mr Oberoi said.
Currently a 50: 50 joint venture between Tata Steel and Steel Authority of India Ltd, MetalJunction was created primarily to pursue the e-commerce initiatives of both the steel majors. Over time, MetalJunction has expanded its activity base to include e-procurement, e-retailing and e-financing for a wide range of industries.
To further expand its activities, especially in physical commerce, the company is set to take over the entire responsibility of marketing products and realisation of proceeds for a medium sized steel company beginning December.
While a specific agreement is yet to be signed, the company concerned has already taken up a retailing programme for Tata Steel guided by e-commerce principles.
As per the deal, MJ will create virtual stocks of products at Tata Steel's depots and market the same to the end consumer or the retailers.
According to Mr Oberoi, the assignment would replace the existing multi-layered transaction system between the producer and the retail customer, which absorbs up to 10 per cent of the price-margin.
This margin would now be shared between MetalJunction and the end consumer.
The steel producer will also directly benefit in terms of greater penetration and better services to retail customers.
Speaking of the company's proposed foray into high-sea trading of nickel and tin, Mr Oberoi said that the project was taken up in collaboration with a PSU company and would take time in fulfilling the formalities.
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