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JSW venture with U.K.’s Severfield

— Photo: Vivek Bendre

BUILDING ON STEEL: Sajjan Jindal (left), Vice Chairman and Managing Director, JSW Steel, with Tom Haughey, Chief Executive Officer, Severfield-Rowen, at a press conference in Mumbai on Monday.

MUMBAI: JSW Building Systems, a wholly owned subsidiary of JSW Steel, on Monday formed a 50:50 joint venture with U.K.-based Severfield Reeve Structures, a wholly owned subsidiary of Severfield-Rowen, the UK market leader in structural steel.

The joint venture — JSW Severfield Structures — will come up in the Bellary district of Karnataka at the Jindal Vijayanagar Steel plant complex. It will be involved in design, production and erection of structural steelwork to principally service the Indian market.

The project will have an initial capacity of 35,000 tonnes annually and is estimated to cost Rs. 220 crore. This will be funded through a mix of debt and equity in the ratio of 2:1. Of the equity portion of Rs. 73 crore, there will be an equal participation from the partners, while the debt will be sourced from banks and financial institutions. Addressing a media conference here, JSW Steel Vice Chairman and Managing Director Sajjan Jindal said, “steel buildings are gaining momentum in India and corporates are increasingly implementing large projects using steel buildings due to the distinct advantage of saving in construction time, enhanced aesthetics and durability. The joint venture business will consume steel plates and galvanized products, thus providing an added value route for JSW Steel.”

Given the high cost of transportation, the plan was to have some more plants “near Delhi, near Mumbai and one in the east of the country, depending on the demand and to the response to the products,” Mr. Jindal said.

Severfield-Rowen CEO Tom Haughey said a building made of steel could be erected in one third the time as it took to erect a concrete structure. “We will have ten key managers from the U.K. in India for the venture.

Anshul Singhal, CEO, of the joint venture company, said, the capacity would go up from 35,000 tonnes to one lakh tonnes over five years.

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