Japan’s Metal One seeks FIPB . nod for three-party JV
JAPANESE trading giant Metal One Corporation has applied to the Foreign Investment Promotion Board (FIPB) for a 5% stake in a three-party joint venture. The other two partners in the JV would be Tata Metaliks and Japan’s Kubota. Tata Metaliks, a pig iron manufacturing company of the Tata Group, would be the majority stakeholder with 51% stake. Kubota would hold 44% while Metal One would invest Rs 3.75 crore in the JV for a 5% stake. While Tata Metaliks would bring its expertise in the manufacture and sales of ductile iron pipes, fittings and accessories, Metal One would be a provider of supply chain and distribution network. Kubota would be the technology partner. Kubota is one of the world’s largest ductile iron pipe makers. The venture would allow Tata Metaliks to foray in the ductile iron pipes business. The project would involve investments of Rs 150 crore. This manufacturing unit located at Kharagpur in West Bengal would use liquid pig iron from Tata Metaliks and is likely to become operational by the end of FY09. Initially it would produce 1.1 lakh tonnes per annum. Metal One was formed in 2003 when the trading giant Mitsubishi’s steel products division merged with the metal unit of another Japanese company Sojitz Corporation. Through this merger, it inherited three ventures in India — a JV with Mahindra & Mahindra called Mahindra Steel Service Centre, Sona Okegawa Precision Forgings and Neel Metal Products. None of these ventures are engaged in the business of manufacturing ductile iron pipes. For Metal One, this would be its second minority equity partnership in the Asian region. It acquired a 5% stake in Thai Metal Trade, a public-listed steel company in Thailand early this month. Thai Metal Trade is Thailand’s largest hot rolled product service centre, steel distributor and manufacturer.