POSCO signs deal to set up steel plant in Maharashtra

The proposed joint venture with Uttam Steel plans to set up the plant in two phases at Satarda in Sindhudurg district. At the NSE, the stock zoomed 7.94 per cent to Rs 40.75 at close.

Last month, the steel giant Posco said it has shifted its focus from the $12-billion proposed steel plant in Odisha, citing “no progress” in the project.

South Korean steelmaker POSCO and Shree Uttam Steel and Power Ltd have agreed to set up a 3-million-tonnes-per-year integrated steel plant in western Maharashtra state, the firm said on Tuesday.

The company has land, rail and water resources in place for the project and hopes to start work on the site probably a year from now, Ankit Miglani, a non-executive director at another Uttam Galva Group company, Uttam Galva Steels Ltd., told Bloomberg TV India in an interview. “Today’s MoU signals our intention to further advance our collaboration with Posco to a higher level”.

Uttam Steel and Power is owned by the co-promoters of Uttam Galva Steels, which is jointly owned by the world’s largest steelmaker ArcelorMittal.

Uttam Galva Steels is one of the largest manufacturer- exporter of value added steel products in India.

In 2011, Uttam Galva had acquired Bangalore-based Brahmani Industries, a company engaged in manufacturing and sale of ferrous and non-ferrous steel, for an undisclosed amount.

At 11:25 hrs Uttam Galva Steel was quoting at Rs 41.70, up Rs 3.85, or 10.17 percent on the BSE.

The steel project in Maharashtra for Posco is in line with its stated shift in strategy to focus on other opportunities in India. The company might cancel the project altogether after a new law made it costlier to source iron ore for the beleaguered plant.