India NMDC to invest upto $3.9 bln in 2nd steel plant | business | Hindustan Times
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India NMDC to invest upto $3.9 bln in 2nd steel plant

India's top iron ore miner NMDC is planning to set up a 2-million tonne steel plant in Karnataka with an estimated investment of Rs 160-180 billion rupees ($3.5 billion-$3.9 billion), a senior company official said.

business Updated: Mar 08, 2010 08:41 IST

India's top iron ore miner NMDC is planning to set up a 2-million tonne steel plant in Karnataka with an estimated investment of Rs 160-180 billion rupees ($3.5 billion-$3.9 billion), a senior company official said.

"The Karnataka state government has already allocated 2500 acres of land in the Bellary/Hospet area. We have also obtained the power and water connectivity for the plant," Joint General Manager N Srinivasan told reporters on Friday.

The integrated plant would be state-run NMDC's second steel facility after the proposed 3-million tonne plant in the Chhattisgarh, expected to be operational by 2014, he added.

NMDC would look at a combination of debt and equity to fund the project, but the amount to be raised would be finalised after the completion of a detailed project report, he said.

The federal government plans to raise about $3 billion by selling an 8.38 per cent stake in NMDC, bringing its public float in the company to 10 per cent. It owns more than 98 per cent in the firm.

The stake sale will open on March 10 and close on March 12.

The sale is part of the government's plan to offload stakes in 60 state-run firms over the next few years as it tries to raise funds for welfare programmes without stretching an already wide fiscal gap.