Posco, Uttam Galva to set up steel plant in Maharashtra

Mumbai: Steel maker Posco Korea said on Tuesday it has signed a joint venture agreement with the Uttam Galva group to set up a three-million-tonne steel plant in Maharashtra.

“Shree Uttam Steel and Power Ltd, a part of Uttam Galva Group, and Posco Korea today signed a memorandum of agreement (MoA) to set up an integrated steel manufacturing facility under a joint venture arrangement in India,” said a press release issued by Posco.

The MoA is the first step toward establishing a joint venture under which the integrated steel plant at Satarda, Maharashtra, will eventually be set up, it added.

The two companies began discussions to set up an integrated steel plant in Maharashtra in 2013. The plant will be set up in two phases, said the company without giving a timeline for completion.

At 12.15pm, shares of Uttam Galva Steels Ltd were trading up 9.25% to Rs.41.35 apiece on BSE, while the benchmark BSE Sensex lost 0.45% to 27,976.41 points.

This is not Posco’s first attempt to set up a steel plant in India.

In 2005, Posco signed a memorandum of understanding to set up a 12-million-tonne integrated steel plant project worth $12 billion in Odisha. But Posco said last month it is temporarily suspending the project due to lack of clearances. Protests by local tribals have also held up the project.

Posco also signed a memorandum of agreement with Mesco Steel this year for relocating a 600,000-tonne steel plant from South Korea to Mesco’s plant site in Odisha.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.