South Korea-based Posco and Russian Severstal will not be given majority stake in their proposed Indian joint ventures with Steel Authority of India Limited (SAIL) and NMDC Limited respectively, entailing a total investment of $6.7 billion, India’s Ministry of Steel said on Wednesday, September 26.
“Talks are going on between the joint venture partners. There are problems relating to shareholding. We cannot give them land, we cannot give them all facilities and still have minority shareholding in the ventures,” India’s Minister of Steel, Beni Prasad Verma said in statement, adding “the joint ventures can be finalized only when Posco and Severstal agree to give our companies majority shareholding in the ventures”.
In 2010, India’s largest iron ore miner, NMDC Limited and Russia’s second largest steel producer, Severstal signed a memorandum of understanding to construct a 3 million mt per year steel mill in southern Indian province of Karnataka at an investment of $3.73 billion.