Top executives of MMTC and Rashtriya Ispat Nigam Limited have held crucial discussions on formalities to explore the acquisition of Neelachala Ispat Nigam Limited (NINL) by the latter.
Their mission was to arrive at a mutually agreeable terms on the valuation of the shares of NINL for acquisition by RINL-Visakhapatnam Steel Plant.
After the talks with RINL Chairman-cum-Managing Director P.K. Bishnoi, which were held along with the officials concerned of the two companies on Wednesday, MMTC CMD H.S. Mann left for New Delhi on Thursday. Mr. Bishnoi later expressed satisfaction over the progress of talks.
The meeting was a sequel to the meeting held at the government level where it was suggested that the RINL and the MMTC arrive at a mutually agreeable price. At the meeting held at the RINL-VSP the methodology of valuation was discussed. The issues involved in the process of valuation are being put up to the government for its consideration.
The MMTC holds about 50 per cent of shares of the NINL. The MMTC and the Orissa Government promoted the NINL. The company has an iron ore reserve of 100 million tonnes. The production facilities of NINL include a 7seven meter tall coke oven battery of 67 ovens with dry quenching and power generating facility, raw materials handling plant (RMHP), sinter plant (SP), a blast furnace (BF) of 1.1 million tonnes per annum and a power plant of 62.5 MW.
Commissioning of the steel making facility at the NINL is at an advanced stage and expected by March, 2011. NINL earned a profit of Rs.37 crores in 2009-10 without steel making.
The acquisition of shares in NINL by RINL would give RINL-VSP several strategic advantages.
