JSW Steel’s plans to make cold rolled grain oriented electrical steel (CRGO) products in India will entail an investment of about Rs 5,500 crore, which will be financed through a mix of debt and equity.
In May this year, the Sajjan Jindal-led company had entered into an agreement with Japan’s JFE Steel to set up a joint venture company to manufacture the entire range of CRGO products at its Vijaynagar plant in Karnataka. The plans to set up a JV firm followed a joint feasibility study conducted by the firms.
“The entire project cost is expected to be about Rs 5,500 crore,” JSW Steel said in a regulatory update, adding both the companies will hold equal stakes in the JV firm.
The initial issued and paid-up share capital of the JV company at the time of incorporation would be Rs 200,000. Subsequently, subject to receipt of regulatory approvals, JSW Steel and JFE propose to infuse equity in proportion to their shareholding, it said.
The board of the JV company will have six members, with both the companies entitled to nominate three directors each.
Earlier in an interview to FE, JSW Steel joint MD & CEO Jayant Acharya said the project should take about three years to commence operations.