Financial Daily from THE HINDU group of publications
Sunday, Dec 18, 2005
Financial Daily from THE HINDU group of publications Sunday, Dec 18, 2005 |
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Corporate
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Alliances & Joint Ventures Tata Steel plans to set up jt venture company with BCCL Ambarish Mukherjee
New Delhi , Dec. 17 TATA Steel plans to set up a joint venture company with Bharat Coking Coal Ltd (BCCL), a wholly owned subsidiary of Coal India Ltd (CIL) for developing the Kapuria block in Orissa. The private sector steel major has proposed to CIL the setting up of a joint venture in which 100 per cent of the investment would be made by the Tatas, while profit would be shared on a 50:50 basis. BCCL, on its part, would provide the coal block for development CIL has also received similar proposals from public sector Steel Authority of India Ltd (SAIL) and the private sector Jindal South West Steel Ltd. According to Coal Ministry sources, CIL has submitted the appraisal of the three proposals and it is up to the Ministry to decide on the future course of action. "The proposals that have been received are similar but lack details. The Tatas have given a detailed plan on how they want to go about it. But SAIL and Jindals have provided certain broad specifications only. As a result, it will be difficult to compare the merits of the three proposals," sources said. The Ministry is likely to ask the other two companies to submit detailed proposals. "We need the proposals in the same format for comparing and deciding what would be best in the interest of CIL because coal has emerged as the critical energy source for the country, at least for the next 50 years," sources said. Officials, however, pointed out that as a public sector CIL would prefer to go along with SAIL and the two companies had several meetings on the issue. "However, things have not made any significant progress during the past few months. While SAIL wants assured supply of around one million tonnes of coking coal from the joint venture and is also prepared to bring in the investments in the form of loan to BCCL, the Tatas have suggested profit sharing," officials said.
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