Kolkata: Visa Steel has entered into a joint venture contract with China’s Baosteel Trading and VISA Comtrade of Switzerland for establishing a 1 lakh tonne-per-annum ferro chrome facility in Orissa.

The joint venture company will be named ‘VISA BAO,’ in which VISA Steel will hold a 51% stake, while Baosteel Trading and VISA Comtrade will hold 35% and 14% stakes, correspondingly.

The total capital outlay of the novel project is estimated at Rs 260 crore that will be financed by a debt:equity mix of 65:35

While commenting on the deal, Vishambhar Saran, VISA group chairman states, “This JV takes our relation with Basosteel another step forward and ensures a win-win situation for both companies through a long-term market for the JV company and a stable supply of ferro chrome for Baosteel’s stainless steel plant in China.”

A large part of the production is expected to be exported to China, where Baosteel is the largest steel company with a total production capacity of 24 million tonnes annually.

Baosteel Group chairman Xu Le Jiang told, “It is a great start for co-operation between Baosteel and VISA Group and we hope the JV will be mutually beneficial to both parties.”

The JV contract was signed by Vishal Agarwal, managing director of VISA Steel, Mr. Li Qing Yu, President of Baosteel Trading and Mr. Vivek Agarwal, executive director of VISA Comtrade in Shanghai. Mr. Xu Le Jiang, chairman, Baosteel Group, Madam Xie, immediate past chairperson, Baosteel Group and many other senior administrators of Baosteel also attended the signing ceremony.

Baosteel is the third foreign company to enter India after Posco and Mittal Steel. The other companies eyeing investments in steel include Marcegaglia, Siosteel, Nippon Steel and Kobe Steel.