Odisha Sun Times Business Bureau
New Delhi, April 1:
Mesco Steel has acquired Maithan Ispat at Kalinga Nagar in Odisha’s Jajpur district for Rs 1,160 crore in a mix of debt and equity deal, revealed highly placed sources in Mesco Steel.
While the deal will go a long way in bailing out Maithan Ispat, which has a debt burden of Rs 795 crore, it will also enable Mesco to utilize its large iron ore mines, the sources said.
A highly placed official at Mesco said that it is a win-win situation for Mesco and will increase the company’s capacity to 2.2 million tonne per annum.
Sources revealed that Mesco is engaged in negotiations with a consortium of bankers led by State Bank of India for repaying the borrowings of Maithan Ispat.
Mesco is going to add 70 tonnes of electric arc furnace to Maithan Ispat, which has a 60-tonne steel melting shop. The company beleives it will a distinct advantage in high beam and section mill, which is also expandable to one million tonnes, the sources added.
Mesco Steel operates two blast furnaces at its plant in Kalinganagar and recently signed an agreement with the world’s fourth largest steel firm Posco for shifting the latter’s patented Finex plant to India.
Mesco operates an iron ore mine in Barbil region and has another iron ore mining lease at Malangtoli in Odisha.