The Hindu Business Line : Essar arm to set up steel co in Vietnam

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Mumbai Feb. 12 The Singapore-based Essar Steel Vietnam Holdings Private Ltd (ESVHL), a subsidiary of Essar Steel, today signed a joint venture agreement with State-owned Vietnam Steel Corporation (VSC) and Vietnam General Rubber Corporation (GERUCO) to form a joint stock company.

The new entity has been named Essar Vietnam Steel Corporation.

The joint venture company will set up a hot-strip mill plant with an initial annual capacity of two million tonnes of HR coils, sheets and skin-passed coils.

Estimated to cost $527 million, the project is scheduled for completion within 30 months.

ESVHL will hold 65 per cent equity, VSC 20 per cent and Vietnam General Rubber Corporation the rest.

The project will be located in Baria Vung Tau province in southern Vietnam.

Vietnam currently consumes six million tonnes of steel, of which HR coils account for two million tonnes.

Vietnam's steel consumption is expected to go up to 10 million tonnes by 2012.

In the absence of a flat-product steel plant, Vietnam imports its entire requirement of HR coils. This project is expected to substitute such imports.

VSC is a fully owned unit of the Government of Vietnam, having several steel plants in northern and southern Vietnam.

Essar has production facilities in India (4.6 million tonnes a year) and Indonesia (0.4 million tonnes).

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