February, 05 2006
Coal Ministry denies CIL's plans to tap capital market
As per reports in media Indian Coal Ministry has denied any knowledge of state owned Coal India Limited planning to raise funds from the capital market, saying the public sector firm was not empowered to do so under the existing articles of association.
Some sources of Coal Ministry are quoted to have said that they were "amazed" by the said report. "How can CIL do that for which it does not have the required mandate?"
Last week some reports quoted unnamed CIL officials as saying that the PSU was planning to launch its maiden public offer. The report quoted sources in CIL as saying that the PSU was planning to hit the capital market with its maiden public offer of 5% paid up capital to raise an ambitious Rs 3,000 crore. The reports further said the entire proceeds from the proposed Initial Public Offer would be used to fund the company's expansion program, to increase production to 571 million tonne by the end of 11th plan period in 2012.
Jkarkhand expects royalty hike during review of mineral policy
With the mineral policy of the country being reviewed, Jharkhand expects a substantial increase in the royalties for its rich mineral resources. "We have sent our suggestions after being asked by the Centre, and if our formula is accepted then Jharkhand may get Rs 500 or 600 crore more royalty," Mines and Geology Minister Mr Madhu Kora said here. He said coal itself has been incurring a loss of Rs one thousand crore royalty owing to prevailing tonnage system.
The state government had applied to the Centre for allotment of 25 coal mines, but sanction was given for only three near Ramgarh in Hazaribag district, he said and added a reminder would be sent for more allotment. "Our object is to provide coal at market rate to small and medium industries operating in steel and sponge. The supply through Jharkhand State Mineral Development Corporation will help them in their work...Even the local youth will get employment," he said.
Coal minister announces a mine for RINL
Indian Union minister Dr Dasari Narayana Rao announced that RINLs Visakhapatnam Steel Plant will get Mahal Coal mine for meeting the increased coal needs in view of the expansion plans
The mine with 5 blocks has iron ore reserves to the tune of 11 million tones.
Blast at Essar plant leaves 12 injured
Express News Service has reported that at least five people were seriously injured, two of them critically and seven others sustained minor injuries after a blast ripped off at the Electric Arc Furnace Unit Number 3 of the Essar Steel Ltd in Hazira works. The police said that the blast occurred following a leakage in the water cooling pipe connected to electric furnace
It is reported that that there has been no loss of production following the blast
Police s conducting detailed investigations
EICC concerned over reactions to Mittal Steel's Arcelor bid
The Europe India Chamber of Commerce EICC has voiced concerns about the "politicization" of Mittal Steel's bid to acquire steel major Arcelor. "Allowing politics to interfere into the free market economy is a dangerous trend that will only harm the economy of Europe," warned Mr Sunil Prasad, secretary general of the Brussels based EICC.
Mr Prasad told INEP agency "The hostile reaction of French and other EU politicians against Mittal's bid also shows the economic immaturity of Europeans in the age of merger and acquisition as a part of globalization process. This further exposes the double standards being practiced by the European Union and its policy makers. It is very surprising to learn the reaction from politicians from France in particular. When French industrial giant Lafarge took over several cement and other allied industries in India, New Delhi welcomed it as a part of free economy and globalization.
RINL to finalize consultants for expansion
RINLs is likely to finalize and appoint consultants for its Rs.8,700-crore expansion plan in a fortnight. Tenders have been called for finalizing consultants earlier, and is about to be finalized.
The consultants would play a vital role in overseeing the tenders, appraisal of designs, their integration, approval and supervision till the capacity attainment was realized. The expansion is meant for doubling VSP's present capacity of 3.2 million tonnes.
Siemens to make turbines in India
Siemens Ltd is setting up a Greenfield industrial steam turbine factory at Vadodara in Gujarat at an investment of Rs 30 crore. We are setting up this plant to manufacture industrial steam turbines up to 45 MW. All the components of these turbines will also be manufactured at this facility, said Mr J Schubert MD of Siemens Limited.
The plant will manufacture key components for steam turbine up to 150 MW. This will enable us to close our portfolio gap in the small turbine segment. The plant is expected to go on stream by December 2006, Schubert added. The plant will cater to the domestic market of steel turbines of below 150 mw. It will also supply turbine components to Siemens manufacturing facilities abroad, he said.
This is the plan for the first phase. In the second phase, we may double the capacity and plan other areas of expansion. Currently, the plant will manufacture an average of 30-40 machines annually depending upon the capacities of the turbines, Mr Schubert mentioned.
Siemens expects an average annual business of Rs 500 crore over the next three years. The total market size for industrial turbines in the country is around Rs 1,200 to 1,400 crore at present.
Arcelor CFO plays China card
Arcelor will become a steel giant producing 100 million tonnes annually within five years and deals in China will be a key path to growth, according to its CFO Mr Michel Wurth. Mr Wurth used an interview with The Observer to outline the Luxembourg-based firm's growth strategy, which he and CEO Mr Guy Dollhope will lead investors to reject a hostile bid from Indian tycoon Lakshmi Mittal. Mittal Steel makes 57.6 million tonnes of steel a year, while Arcelor makes 47 million and Mr Mittal says the combination would produce unprecedented benefits of scale and place it at the forefront of inevitable consolidation in the global steel industry.
Mr Wurth, however, says Arcelor can reach 100 million tonnes a year by itself, by expanding its operations, particularly in Brazil, and acquiring high value assets, rather than by joining with Mittal. We look to 100 million tonnes in five years' time. We have the opportunity with a very nice growth strategy he said. Mr Wurth pointed to recent acquisitions of Erdemir in Turkey and Dofasco in Canada, which add some 10 million tonnes to output.
He added Then we are negotiating deals in China, which have not yet closed. Mr Wurth said Arcelor was in the closing stages of discussions with China's 10 million tonne Laiwu Steel over a joint venture to build a new plant in the People's Republic. Arcelor sees China as a key growth market for high-grade steel for its rapidly expanding automotive market. There is also strong demand for steel for infrastructure development, construction and appliance manufacturing.
EU regulators mull over jurisdiction for Arcelor takeover bid
Four European financial regulators have held talks on how to handle Mittal Steels hostile bid for Arcelor. Sources close to the negotiations say the talks centre on which jurisdiction should handle the takeover. Arcelors primary listing is in Luxembourg, but its shares trade in France, Belgium and Spain. Regulators from each of the countries held talks at the end of last week.
The matter is thought to be complicated by the Luxembourg stock exchanges small size, and its lack of history of hostile bids. This might be the first hostile bid that Luxembourg has ever had, said one source. Some bankers think Luxembourgs corporate law on hostile takeovers is vague compared with that of France, but most expect the jurisdiction to rest with the Grand Duchy.
Kazakh ore giant SSGPO reduces pellet exports 21% in 2005
Sokolov Sarbai Mining Production Association SSGPO, Kazakhstan's biggest iron ore producer, reduced pellet exports 21.1% in 2005 to 6.04 million tonnes but increased concentrate exports 5.1% to 3.85 million tonnes. It is also reported that SSGPO doubled pellet exports to China to 3.99 million tonnes, while pellet exports to Russia plummeted 40.1% to 3.99 million tonnes. Concentrate exports to Russia fell 5.3% to 3.47 million tonnes.
Exports to Russia are thought to have fallen due to a conflict between
SSGPO and MMK as they had been unable to agree prices, and SSGPO stopped shipping commercial ore to MMK in May 2005. MMK arranged alternative ore supplies from Ukraine and Russia, while SSGPO has tried to redirect sales to China.
MMK and SSGPO then agreed on a partial resumption of supplies, and SSGPO shipped 200,000 tonnes of concentrate to MMK in each of August and September and 250,000 tonnes in October, and 100,000 tonnes of pellets in September and 150,000 tonnes in October. But this was still a far cry from the 750,000 tonnes of ore a month that MMK bought on average from SSGPO in 2004.
ThyssenKrupp buys Canada's VPK Metals & UKs Metalfast
Dsseldorf based German steel giant ThyssenKrupp AG said that it has acquired a Canadian Toronto based VPK Metals Inc copper & brass company and a Swindon UK based Metalfast Ltd aluminum business company. Financial details weren't disclosed.
VPK will become part of the German company's services unit. VPK employs 260 workers and had sales of $108.6 million US in fiscal 2005. The company trades copper and brass products and has seven branches in the United States and Canada.
Metalfast Ltd., which employs 80 workers and had sales last year of $21.7 million, will become part of ThyssenKrupp Materials U.K. Ltd. It warehouses and cuts aluminum products.
Gerdau invests 34.5 million reais in Aconorte plant
Gerdau, one of the biggest long products producers in Brazil, has invested 34.5 million reais to add a scrap shredder. The shredder at the companys Aconorte plant has the capacity to recycle 1, 200 small vehicles per day. At the same time, Gerdau also installed new dust collection equipment at a price tag of 8 million reais. The equipment will collect the dust that is generated by the processing of scrap.
According to Gerdau the company will be able to handle up to 70% more scrap at the plant. The plant has a 280, 000 tonnes per year capacity of crude steel and 250, 000 tonnes per year of rolled products.
Chinas passenger car production up 26.9%
According to the official report released by Chinas National Bureau of Statistics, China produced 2.96 million passenger cars in 2005, up 26.9% YOY.
Within that figure, the production of passenger cars in the month of December last year alone came up to 308,000 units, increasing by 60.2% compared with the same month in 2004.
Also in 2005, passenger car production in Anhui and Guangxi provinces rose by 100%, said NBS. The increase in six other provinces including Guangdong and Suzhou stood at 50% and above.
Arcelor CEO Mr Gut Dolle a man of steel
For Mr Guy Dollthe battle for Arcelor is not just business, its a matter of trust. Soccer loving chairman of the management board of Arcelor, who has applied every skill he has learned in decades on the football field to building a world class team at Arcelor, the bid from Mittal Steel is his worst nightmare come true.
Born to a family of modest means in Compine France on 31 October 1942 Mr Dollis the eldest of four children and grew up in Metz, eastern France. But his youth, and his character, were permanently marked by the death of his mother when he was 10. He was raised by his father and aided and guided through his education by the friends who rallied round to help. Those experiences have left him wedded to a sense of community. As a result, he is acutely conscious of the role of the company he heads in the lives of its 100,000 employees.
A brilliant pupil at school, Mr Dollwent on to study at the highly regarded Ecole Polytechnique in Paris. From there, he began his working life in 1966 at the Irsid Steel Research Centre. His 14 years in steel research equipped him with an astounding technical knowledge of the industry and its products which have stood him in good stead. He was recruited in 1980 by Usinor. For two decades, he worked his way up through the business, step by step, until in 1999 Mr Francis Mer, the formidable chairman who subsequently became French finance minister, made Mr Dollsenior executive vice-president. But when Usinor merged with Arbed of Luxembourg and Aceralia of Spain to form Arcelor in a deal completed in February 2002, the choice of MrDollto be CEO was greeted with universal surprise.
Mr Dollis a man who thinks ahead, searches for consensus, nurtures his team. He is a man of modest manner and even more modest lifestyle and is married with two children. His pastimes are simple ones. Like many a French executive, he fancies himself as a chef, with scallops and fish among his most successful recipes. Intelligent, able and amiable Mr Dollmay be, but also has nerves of steel and a remarkable capacity to learn new tricks.
US moves in court to seize pension plan of WCI
The federal government said it filed suit yesterday to seize the pension plan of the bankrupt WCI Steel, saying the plan was more than $100 million short of the amount it needed. The move is a first step toward holding WCI's corporate parent, the Renco Group, responsible for the money. "Our action today is designed to protect workers from lost benefits and the pension insurance program from an unnecessary claim," Mr Bradley D Belt, the executive director of the Pension Benefit Guaranty Corporation, said in a statement.
On Monday, a bankruptcy court is scheduled to consider the noteholders' reorganization plan for WCI, which calls for moving the business assets out of the steel company and leaving the pension plan in an empty corporate shell. If that happened, the agency would lose its ability to tap the Renco Group's assets to cover the cost of paying the pensions. The noteholders are not willing to take over the pension plan.
American Axle reports 86% drop in its profit
American Axle & Manufacturing Holdings Inc. said Friday its earnings fell 86% in the fourth quarter and 65% for the year. For the fourth quarter ending Dec. 31, the Detroit-based auto supplier of driveline and chassis systems said it had net income of $4.5 million down from net income of $31.3 million during the same period a year ago. For the year, American Axle posted net income of $56 million down from a net income of $159.5 million in 2004.
American Axle's lower net income is reflective of a drastic change in operating income. American Axle's operating income was down 83% for the quarter and down 63% for the year. The company said the drop in operating income reflects the impact of higher energy, steel and other metallic material prices; the increased cost of providing health care, pension and supplemental unemployment benefits for hourly workers, and lower production volumes from automakers.
Algoma Steel fined for safety violation resulting in death
Algoma Steel Inc, a steel manufacturer based in Sault Ste. Marie, was fined $313,000 on February 2, 2006 for a violation of the Occupational Health and Safety Act that resulted in the death of an employee.
A Ministry of Labor investigation found the chute opening was protected on three sides. There was a guardrail on one side, a fixed piece of equipment on a second side and a wall on a third side. At the time of the incident a guardrail was also installed on a fourth side, but the gate had been left in an open position. The gate had been installed about 20 years earlier as a safety precaution after another worker fell part way into the chute and was injured, but over time proper use of the gate became inconsistent. Although the gate was sometimes kept closed, it was left open for periods of time.
Algoma Steel Inc pleaded guilty, as an employer, to failing to ensure there was a guardrail around the perimeter of the chute opening, as required by Section 13(1) (a) of the Regulations for Industrial Establishments.
On April 26, 2004, an electrical worker was attempting to visually trace some wire that ran along a ceiling when the worker walked over an opening to an "alloy addition chute" in the floor and fell about 10.7 meters into a pit below. The worker died as a result of injuries sustained in the fall. The incident occurred at the company's No 2 Basic Oxygen Steelmaking Plant at 105 West Street in Sault Ste Marie.
Ryerson unions ask for strike vote
Steelworkers are negotiating with Ryerson Inc. as labor agreement expires and it is reported that unions representing about 500 workers at Ryerson Inc.'s Burns Harbor coil processing plant and two Chicago facilities will ask for a strike authorization vote February 12.
USW and International Brotherhood of Teamsters who are jointly negotiating with Ryerson on a successor labor agreement to the one that expired January 31. Negotiations began in December and are continuing with two sessions scheduled later this month. The two sides currently are bargaining non economic issues but haven't come to any agreement on the work rules
Mr Terry Rogers, Ryerson's vice president of finance and treasurer, said he believes the company and union both are hoping to reach a settlement without a strike or a lockout. "We hope we will reach a settlement that's acceptable for both parties," he said.
Ryerson, which changed its name from Ryerson Tull January 1 to reflect its acquisition of Integris Metals in January 2005, is a leading North American distributor and processor of metals, with revenues of $4.5 billion through the first nine months of 2005. The company has a network of service centers across the United States and in Canada, Mexico and India.
Port of Longview sells land for steel distribution center
R&R Trading Inc of Delta British Columbia Canada is spending $2.2 million to buy 35 acres at the Port of Longview for a steel distribution center under an agreement port commissioners approved Friday morning... R&R will invest $5 million to build a new warehouse
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