Tata Steel signs mill pact with Vietnam co
NEW DELHI - Tata Steel Ltd has signed an agreement with state-run Vietnam Steel Corp to explore building a cold rolling mill in the Southeast Asian country, the Indian firm said in a statement.
Tata Steel, the world's sixth-largest steel maker, will undertake a feasibility study for the project, the statement released on Wednesday said, and could buy a 65 percent stake, with the Vietnamese firm holding the rest.
The two companies are also carrying out a separate feasibility study for a steel project in Vietnam's Ha Tinh province.
"Both the companies firmly believe that the simultaneous development of the domestic primary steel and value-added steel production is fundamental to the sustainable growth of the steel industry in Vietnam," the statement said.
Tata Steel did not give details of potential investments.
The firm's September quarter net profit rose a better-than-expected 8 percent due to higher metal sales and foreign exchange gains.
Robust demand from construction and the auto industry and declining exports from China kept steel prices strong, and analysts expect Tata Steel to gain significantly from this year's $13 billion purchase of Anglo-Dutch steelmaker Corus Group.
The annual steel capacity of Vietnam Steel is two million tonnes, while Tata Steel's combined capacity after the acquisition of Corus is 25.6 million tonnes.
Reuters - October 31, 2007.
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