Indian steelmaker Steel Authority of
India Limited (
SAIL) and South Korean steel major
POSCO have reached an agreement on equity participation to construct a $952 million automotive grade steel mill, an official at
India's Ministry of Steel said on Friday, May 29.
The official said that negotiations on setting up a joint venture were in the final lap and a formal agreement will be signed between the two sides very soon, as
POSCO has agreed to hold a minority stake in the steel mill project.
India's largest steel producer,
SAIL, and
POSCO had signed a memorandum of understanding (MoU) for construction of automotive grade steel mills in 2011 but plans failed to make headway as both partners insisted on holding majority equity in the project, the official said.
However, the proposed capacity of the plant, to be located in proximity to
SAIL's existing steel mill at Bokaro, has been halved to 1.5 million mt per year.