Kolkata: The public sector steel giant SAIL and the Korean steel major POSCO have formed a combined team to give a concrete shape to their recently declared coalition. Despite allocation of best practices, the grouping could open the prospect of POSCO utilizing SAIL’s immense marketing network through use of the latter’s stockyards crosswise the country.

Mr. S K Roongta, chairman SAIL said, “We have formed a working group which will have four members each from SAIL and POSCO to look into various areas in which the two companies can form alliances.”

While lecturing on the sidelines of the 34th national management convention organized by AIMA, Mr. Roongta said POSCO is investing Rs 52,000 crore, the largest FDI received thus far to construct a 12 million tonne steel plant in Orissa.

The coalition signals a few large arenas of teamwork where both companies can strap up synergies in terms of sharing people and actions. There would be exchange of engineers, trained workers and other experts. Subject to further talks, both companies would also collaborate in combined R&D and other mutually-agreed projects.

Mr. Roongta also said that ERP, Information sharing and Six Sigma are a few of the domains the company could collaborate. For POSCO especially, which is establishing shop in India, it will gain access to SAIL's large domestic network and resource base.

Mr. Roongta stated that the grouping would involve exchange of resources together with dual marketing, storehouses and service centres in India and abroad.

Notably, it could provide POSCO access to SAIL’s stockyards all-through the country. Nodal stockyards offer SAIL a massive reach to its clients. But, individual contracts would have to be signed between the two encase the two settled on this subject. Likewise SAIL could also take advantage of the South Korean firm's worldwide existence.