The Hindu Business Line : SAIL mulls joint venture cement unit with Jaiprakash

Steel Authority of India Ltd (SAIL) has selected Jaiprakash Associates Ltd, formerly known as Jaypee Cement, for its proposed cement joint venture at Bhilai.

Sources said the plant would be using the slag generated by the Bhilai Steel Plant (BSP). Its capacity would be 2 million tonnes per annum and it would go on stream by 2009.

SAIL would be floating a joint venture company with the Rs 3,141-crore Jaiprakash Associates and it would be holding 26 per cent stake in it. As an initial investment, the company would be contributing Rs 10 crore as equity capital.

SAIL first floated the idea of a joint venture cement plant in 2004. It has plans to set up a similar cement plant at Bokaro too. The idea is to make proper utilisation of the slag because its disposal is no longer an easy proposition.

Moreover, with the company planning to increase the capacity of BSP from 5 million tonnes per annum to 7 mt, the generation of slag would also increase from 1.5 mt per annum to 2 mt.

At present, SAIL is selling the slag to cement companies through medium term contracts but it is not enough for a total disposal. So, the cement joint venture was contemplated.

An open tender was floated. Apart from Jaypee Cement, Shree Cement of Mr H.M Bangur and Birla Corporation of the MP Birla Group participated in it.

According to SAIL sources, Jaypee Cement succeeded in outbidding its two competitors after a close scrutiny by Ernst & Young, the merchant banker, and Holtec, the cement technical consultant.

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