Japan’s diversified conglomerate Sumitomo Corporation has agreed to buy a 49% stake in its Indian joint venture Mukand Sumi Special Steel Ltd for Rs 1,181 crore ($173.6 million), said JV partner Mukand Ltd, an auto steel supplier, on Friday.
Sumitomo and Mukand had announced the JV in March 2017, whose proposed Karnataka mill would get semi-finished casting products -- blooms and billets -- from Mukand’s plant in Hospet, a city in the state. The joint venture has 100 acres of land adjoining Mukand’s plant at Hospet with a proposed investment of Rs 600 crore for the construction of the mill by mid-2020.
The JV will supply steel to the automotive and engineering industries. Mukand will retain 51% equity in it.
Apart from Hospet unit, Mukand also produces stainless steel from its facility in Thane, Maharashtra.
For Sumitomo Corp, which is present in 129 locations in 66 countries, the investment in India will give it access to the country’s fast-growing market for auto components, which is a Rs 3 trillion industry.
Other large steelmakers in India include JSW Steel Ltd and Tata Steel Ltd.
On Friday, Tata Steel said it had completed the acquisition of rival Bhushan Steel after receiving all necessary approvals.
This came after the bankruptcy tribunal this week finally approved Tata Steel’s insolvency resolution plan for Bhushan Steel, moving aside a plea by Bhushan Steel’s employees contesting the bid.
To be updated...