Specialty steel maker Mukand Ltd and Sumitomo Corp of Japan have signed an agreement to form a joint venture that will set up a rolling mill in Karnataka.

The JV, Mukand Alloy Steel Pvt Ltd MASPL, will set up a steel rolling mill unit at Hospet in Karnataka with an initial capacity of 3,75,000 tonnes per annum.Mukand will hold 51 per cent stake in the JV and Sumitomo 49 per cent equity with an enterprise value of Rs 2,820 crore, a statement said here.

The new company will be engaged in the rolling and finishing of Mukands principal business of alloy steel long products. It will exclusively procure the required alloy steel billets and blooms from Mukand's steel making facility at Hospet, it said.

The agreement was signed at Kyoto, Japan today in the presence of Rajesh Shah, Co Chairman and Managing Director of Mukand and Kuniharu Nakamura, President and CEO of Sumitomo.MASPL will initially invest Rs 550 crore in the proposed plant at Hospet.

The JV will combine Mukands manufacturing and engineering capabilities and Sumitomos marketing management skills and know how to cater to a growing automobile market globally, the statement said.

Sumitomo is a leading trading and business investment company having a presence in 66 countries. Apart from various other businesses, Sumitomo is engaged in the supply of steel products that are supplied to automakers as materials for a broad range of auto parts.

 

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