Asked recently by FE if there was any plan to feed the various production centres of NatSteel Asia with either iron ore or sponge iron from this country, the managing director B Muthuraman said, as NatSteel Asia has secondary steel-making facilities through electrical arc furnaces which use scrap, so iron ore and sponge may not be needed.
As to what economics Tisco was going to follow in running these plants located in Singapore, China, Malaysia, Thailand, Australia, Vietnam and the Philippines, he said the steel major would help NatSteel Asia source billets immediately and set up a long-term source for raw materials. He added, other plans are still under discussion and will be finalised later.
It may be recalled that Tisco had signed a definitive agreement with NatSteel in August 2004 to buy out the latters 2 million tonne capacity steel business.
According to the agreement, NatSteel would hive off its steel business into a separate company - NatSteel Asia Pte Ltd (NSA)- at an enterprise value of Rs 1,300 crore. Tisco would then pick up 100% equity in the company.