*Southern Ispat and Energy Ltd* is acquiring *New Tech Forge* for Rs 95 Cr to expand its presence in alloy steel and forging space. The deal will be completed in the next two months.
It is also in the process of buying iron ore mines in MP, with estimated reserves of 250 mn tones for about Rs 50 Cr. It is also buying 95% stake in an Indonesian mine. It intends to increase its captive power production from 8 MW to 30 MW using the coal imports from Indonesia. The company has also lined up a capex plan of about Rs 300 Cr for 2010 to augment its production line. It may also raise funds from Indian or overseas markets to partly fund its capex plans. The funds might be raised through GDRs, ADR or FCCBs. Transaction Note Southern Ispat & Energy Ltd. was incorporated in 1995. Then in 2008, the company was renamed as Southern Ispat & Energy Ltd. It is engaged in manufacturing and trading of steel products in India. The company’s products include ingots of iron and steel other than high carbon, steel bars and rods, hot rolled in irregularly wound coils, and non alloy steel. It also involves in the provision of contract services and commission agents services. Recently, the company also decided to increase the authorized share capital of the company from Rs 18 Cr to Rs 60 Cr. SIEL reported a PAT of Rs 3.7 Cr on revenues of 175.4 Cr for the quarter ended Dec’09. Kutch based - *New Tech Forge and Foundry Ltd* has a steel manufacturing capacity of 2.5 lakh tpa and also has significant exposure in overseas markets. This acquisition could prove to be a strategic fit to SIEL as it was looking to set an integrated steel plant for some time now. SIEL has an annual production capacity of about 33,000 tonnes and plans to double it in next few years. *Indian Steel Industry* According to a *Credit Suisse Group* study, the steel consumption in India is expected to grow 16% annually till 2012, majorly due to growing demand for construction. Presently, India accounts for 5% of the global steel consumption, of which 70% is used for kitchenware. However, its use in railway coaches, wagons, airports, hotels and retail stores is growing immensely. The per capita steel consumption in India is only 35 Kg – compared to 150 Kg across the world and 250 kg globally. -- Regards Hardik Shah -- You received this message because you are subscribed to the Google Groups ""GLOBAL SPECULATORS"" group. To post to this group, send email to [email protected]. To unsubscribe from this group, send email to [email protected]. For more options, visit this group at http://groups.google.com/group/globalspeculators?hl=en.
