Monnet Ispat and Energy Ltd has entered into a technical collaboration with Italian firm Scandiuzzi SRL to set up a steel engineering and fabrication facility at Haldia with an investment of Rs 400 crore and a production capacity of 1.20 lakh tonnes.
"Monnet would hold 65 per cent in the JV while the Italian partner would hold the rest 35 per cent," Monnet Ispat and Energy Ltd Managing Director Sandeep Jajodia told PTI.
The investment would be made in two phases and the first phase, for which the company would invest Rs 100 crore, is expected to be complete by December next year.
"The unit would have an initial capacity of 40,000 tonnes per annum and depending on the response from both domestic and export markets, we would further invest Rs 300 crore to take up the total capacity to 1,20,000 tonnes," Jajodia said.
The second phase of the expansion is expected to start in fiscal 2008-09, he added.
The fabrication unit would promote steel applications in India by producing critical infrastructure material such as railway bridges and transmission towers, Jajodia said.
The company expects 50 per cent of its fabrication business revenues from export markets.
"Scandiuzzi has a huge presence in Europe, West Asia and North Africa where the demand for such products is high. We expect to gain from our Italian partners' marketshare and hope to supply finished material from the Haldia unit," he added.
The company had recently announced an investment of a whopping Rs 4,000 crore for setting up a 0.25 MT sponge iron and steel plant, a 1,000 MW power plant in Orissa and for increasing its steel production capacity to 1.5 mtpa.
It is setting up a 1.2 mtpa greenfield steel plant to achieve the increased steel production capacity.