The Hindu : Business : SAIL, Posco sign MoU

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Friday, Aug 17, 2007
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SAIL, Posco sign MoU

Special Correspondent

To cooperate in raw materials’ purchase

To conduct R&D projects
Joint coordination group planned

NEW DELHI: The state-owned Steel Authority of India Ltd. (SAIL) and the Korean steel-maker Posco on Thursday inked a memorandum of understanding (MoU) to forge a strategic alliance for cooperation in the purchase of raw materials and marketing network sharing in India.

According to an official statement here, the MoU to enter into a strategic partnership with the world’s fourth largest steel producer was signed here by SAIL Director (Personnel), G. Ojha, and Posco’s Senior Executive Vice-President and Board Member, Soung-sik Cho, in the presence of SAIL Chairman, S. K. Roongta.

As per the MoU, SAIL and Posco would cooperate in sharing information and corporate strategy planning, sharing of know-how in the development of mines, joint use of their existing marketing and warehousing networks and coordination in the procurement of raw materials such as coking coal, nickel and ferro alloys and engagement of transportation vessels.

Subject to further discussion, the two companies would also cooperate in conducting joint research and development projects in other areas. The MoU is to be effective initially for three years and the two companies would establish a joint coordination group within two weeks to monitor, guide and review its implementation process.

“The strategic alliance between the two steel giants is a significant step toward synergising their strengths while retaining their identities in the rapidly consolidating global steel industry,” SAIL said in a statement.

According to Mr. Cho, who is also the Managing Director of Posco India, both the steel majors will benefit extensively from each other’s strengths.

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