SSAIL today signed a shareholder agreement with M/s Jaiprakash Associates Ltd (JAL) to form a Joint Venture Company (JVC) for producing 2.2 Million Tonnes (MT) cement per annum from the slag generated during the Blast Furnace operations at its Bhilai Steel Plant. The agreement was signed by Mr. G. Ojha, Director (Personnel), SAIL and Mr. Manoj Gaur, Executive Chairman of Jaiprakash Associates Ltd. in presence of Mr. S.K. Roongta, Chairman, SAIL. M/s Ernst & Young are the lead consultant and financial advisor for this venture and M/s Holtec is the technical consultant. Director (Finance), SAIL, Mr. Soiles Bhattacharya and Regional Director of Ernst & Young, Mr. Prashanto Sengupta were also present on the occasion.
The JVC will have 26% equity contribution from SAIL and 74% from JAL, making it SAIL’s largest joint venture with a private sector player. The Board of the JV Company will have members from both companies in proportion of their equity. The JV will have its unit located at Bhilai and Satna to have better economies of operations.
While SAIL is India’s largest steel producer, M/s Jaiprakash Associates is 5th largest cement producer in India and the JV will benefit from their strengths in respective areas. The approximate cost of this project is Rs. 600 crore which will be completed in 37 months.
The JVC is being formed as a part of the company’s sustained eco-friendly efforts to explore the alternative mode of slag disposal at its Bhilai Steel Plant. The JV will enable the plant to gainfully utilize the slag generated in its Blast Furnaces and also the idle assets of Satna Mines.
While SAIL will offer 1 MT of granulated slag annually and provide land at Bhilai and Satna on lease to the JVC, JAL will organize debt and ensure project execution within defined scope, cost and time. JAL will also be responsible for project and operations of the JVC.
On the occasion Mr. S.K. Roongta, Chairman, SAIL said “This is the largest joint venture that SAIL was embarking on with a partner from private sector. Steel and cement being the prime inputs for infrastructure development of the country, we are happy for our association with the cement industry”.
Mr. Manoj Gaur, Executive Chairman, JAL, said, “It’s a giant stride for J.P Associates to be a JV partner with a business organization like SAIL. The JV will have state-of-the-art technology and shall be completed ahead of schedule.”
SAIL has plans to set up a similar cement producing unit as a joint venture in Bokaro. The earlier joint ventures of SAIL in power plants at all its major integrated steel plants are running successfully.