RINL moots proposal for merger with NMDC

May 30, 2008

May 30 (The Hindu Business Line) – With an eye to ensure iron ore security, Rashtriya Ispat Nigam Ltd on Friday mooted a proposal for merger with another state-run company National Mineral Development Corporation, saying it would be beneficial for both.

Mr P K Bishnoi, chairman-cum-managing director of RINL, the corporate entity of Vizag Steel, said “NMDC has iron ore and wants to foray into steel-making, while RINL does not have iron ore, but has expertise in steel-making. If the two come together it m ake greater sense.”

Asked whether RINL has approached the Steel Ministry seeking merger of the two state-owned entities, he said there was no formal discussion with the ministry on the proposal.

“We had informal talks both with the ministry as well as with NMDC. It is our concept and thought. Consolidation and merger is taking place all over the world,” he said.

Mr Bishnoi said RINL had pulled out of the proposed joint venture steel plant with NMDC and SAIL at Chhattisgarh, since NMDC said iron ore would be supplied to the new company at the market price. SAIL had also opted out of it, he said.

He said that if such a merger took place, RINL that is currently undergoing expansion could increase its capacity beyond 16 million tonnes, as planned.

NMDC, he said, had a proven reserve of more than a billion tonnes of iron ore and produced around 27 million tonnes annually.

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