SAIL ArcelorMittal auto steel JV stuck on 30-year clause - Report
Business Standard, citing a senior official with direct knowledge of the matter, reported that Steel Authority of India’s (SAIL’s) reluctance to join a non-exit 30-year contract has delayed its joint venture with ArcelorMittal for specialised steel. The source said “These joint ventures take time because many commercial issues are involved. Since the JV would be for a very long duration, you have to be very careful as to what the present challenges are and what market would be there so that the joint venture remains profitable throughout its tenure.”
He said “Auto grade steels are a purview of very select companies in the world, it’s a highly protected market and once we have developed this particular product, the company that is giving the technology wants to ensure that aren’t very quick exits because these technologies take a lot of time to develop and a lot of money is involved,.”
The joint venture has been in the works for three years but the two steel majors are yet to sign a formal agreement.
Source : Business Standard