ArcelorMittal Plan US$20Billion India Foray
June 2 – Global steel giant ArcelorMittal will spend at least $20 billion setting up two new integrated steel plants in India from 2009 onwards, company executives told CNN.
The two projects, based in the eastern states of Orissa and Jharkhand, will be the largest foreign direct investments yet seen in India and will add 24 million tonnes of annual steel production capacity.
Luxembourg-based ArcelorMittal is the world's biggest steel maker, with annual capacity of 120 million tonnes, but has no presence yet in the fast-growing Indian market.
The company was formed in 2006 from the merger of Arcelor and Mittal Steel and is headed by Lakshmi Mittal, the London-based Indian billionaire whose 45 percent stake is worth more than $60 billion.
The Orissa and Jharkhand greenfield projects represent the first Indian investment by Mittal, though his brothers and father have run the family steel business, Ispat Industries, in India since 1952. Mittal, 57, is chairman and CEO of ArcelorMittal, which last month (May) reported 2008 first quarter net income of $2.4 billion.
"India is a very exciting growth story for us," said Mittal's son Aditya, who is the company's chief financial officer, "India's per capita consumption of steel is only 40 kg, compared with a figure of 500 kg for Europe and 270 kg for China."
ArcelorMittal has identified India as one of its key growth markets in its push to reach 150 million tonnes of production by 2012. ArcelorMittal's London-based head of investor relations, Julien Onillon said the first Indian project was likely to be built in two phases, each of 6 million tonnes, though that would depend on market conditions.
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