The Indian Iron and Steel Company (IISCO), a 100% subsidiary of Steel Authority of India Limited (SAIL) has been amalgamated with the parent company with effect from 16 February 2006. The Ministry of Company Affairs (MoCA) issued the final order on 15 February 2006 approving the scheme of IISCOÔÇÖs amalgamation with SAIL. As per the order, the appointed date of amalgamation is 1 April 2005.
The matter of amalgamation of IISCO with SAIL was referred to the MoCA following the approval of the Government of India in June 2005 and subsequent clearance given by BIFR to the Ministry of Steel. The consent of SAIL shareholders in this regard was taken at an Extraordinary General Meeting held in New Delhi on 8 November 2005.
With the above merger, the largest steel maker of the country, SAIL further grows in size with five integrated steel plants under its fold. Keeping the merger in view, an expansion/modernization plan has already been finalized, envisaging an investment of around Rs 8,000 crore for technological upgradation of IISCO, taking its annual hot metal production capacity to 2.5 million tonnes by 2011-12 from the present level of 0.85 million tonnes.
IISCOÔÇÖs iron ore mines at Chiria in Jharkhand are rich in quality and quantity. Their strategic location would be advantageous for SAIL. Availability of large infrastructure facilities with IISCO will help expansion of capacity. Inter-plant synergy can be better exploited for improved and complementary product-mix. Moreover, IISCO has experienced manpower with good work culture. And SAIL has financial and managerial capabilities that can be pooled for faster growth of SAIL, including IISCO.
Commenting on the merger of IISCO with SAIL, Mr V.S. Jain, Chairman, SAIL said, ÔÇ£The trend in the industry world over has been towards merger and consolidation leading to creation of greater value for stakeholders. IISCOÔÇÖs merger with SAIL will help the company to build better synergy resulting in faster growth of the companyÔÇØ.