Posted on 03 Aug 2023
India’s JSW Steel and JFE Steel Corporation have reached an in-principle agreement to establish a 50:50 joint venture company to manufacture cold-rolled grain-oriented electrical steel products (CRGO) in India, JSW informs.
The companies, however, did not reveal the details of production capacity or the timeline of the proposed project.
This follows the joint feasibility study done by both steel companies in May. The JV will be able to manufacture the entire range of CRGO products at its proposed facilities in Vijayanagar, Karnataka. It will be the first company to produce CRGO products with its entire chain of manufacturing processes based in India (see Kallanish passim).
The JV has been set up for the “manufacture and sale of CRGO using industry-leading machinery, technical know-how, and JFE Steel’s energy-efficient production technology developed through extensive R&D", JSW says.
The entire project cost is expected to be approximately INR 5,500 crore ($664.81 million) and will be financed by a mix of equity and debt.
According to the Indian steel major, the initial issued and paid-up share capital of the JV at the time of incorporation will be INR 200,000, divided into 20,000 equity shares of INR 10 each. This will be wholly owned by JSW. Subsequently, subject to the receipt of regulatory approvals, JSW and JFE each propose to infuse equity into the JV in proportion to their proposed shareholding.
The JV’s board of directors will consist of six members. JSW and JFE will be entitled to nominate three directors each, consisting of one full-time executive director and two non-executive directors.
Electrical steel products that contain additives like silicon and aluminium offer excellent magnetic properties such as high magnetic flux density and low iron loss, JSW says. CRGO exhibits excellent magnetic properties in a single (rolling) direction, making it ideal for the iron cores of power transformers.
Source:Kallanish
