Donald Trump has said that JSW Steel’s investment is the perfect example of strong business ties between India and the US.
New Delhi: Indian steel major JSW, upbeat after the mention of its projects in the United States by President Donald Trump, has said it will further augment its two capacities in Ohio and Texas, to 4 million tonne per annum (MTPA), with a total investment of $1 billion in that country.
Donald Trump, in front of over 50,000 Indian-Americans and Prime Minister Narendra Modi for the “Howdy, Modi” event, mentioned JSW as an industry leader and recognised its efforts in revitalising a shuttered steel plant in Ohio. He stated that JSW Steel’s investment is the perfect example of strong business ties between India and the USA. JSW Steel (USA) is a subsidiary of JSW Steel Ltd.
Parth Jindal, Director of JSW Steel (USA), said: “We are pleased to share our intention for additional investments in the US. It is our intention to further augment our capacity in Acero Junction over the next few years and to take the combined capacity of JSW USA to 4 MT per annum—3 MT at Acero and 1 MT at Baytown in Texas.” Reacting to the mention by Trump, JSW Group Chairman and Managing Director Sajjan Jindal said he was humbled by the mention and his team will continue with their deep commitment towards growth in the United States.
The company proposes an investment of $500 million in acquiring, enhancing and upgrading Acero Junction Inc, an integrated steel manufacturing unit with a potential capacity of 3 MTPA. The investment is being made in two phases at its Ohio steel manufacturing facility. In phase one, JSW will revamp and restart the electric arc furnace and the slab caster, and modernise the hot strip mill. The proposed investment, including the cost of acquisition, is expected to be about $250 million.
In phase two, the JSW will evaluate the possibility of adding another electric arc furnace as well as additional manufacturing equipment at the hot strip mill to make the Ohio facility a fully integrated unit with 3 MTPA capacity. The proposed investment in this phase could be in the range of $250 million.
The Ohio unit was acquired as part of the recently concluded Acero Junction Holdings Inc. deal. A certificate evidencing the proposed investments by JSW Steel was earlier signed by Wilbur Ross, Secretary, US Dept of Commerce and Jayant Acharya, Board Member and Director (Commercial & Marketing), JSW Steel Ltd at Select USA Investment Summit held at the National Harbor, Maryland, outside Washington, D.C.
On the other hand, MoU for the Texas facility was signed in March last year to develop and augment the steel industry in Texas. According to the memorandum between Parth Jindal of JSW Group and Greg Abbott, Governor of Texas, in partnership with Texas Enterprise Fund, JSW Steel (USA), agreed to invest up to $500 million in phases in developing its steel manufacturing infrastructure in Baytown, Texas USA. As part of this Memorandum, Governor Greg Abbott also approved $3.4 million grant from the Texas Enterprise Fund to the company.
The intended investment by JSW USA will be used to undertake capability enhancement of its Plate & Pipe Mill unit located in Baytown, Texas, USA. The company will invest $150 million to augment the unit’s capabilities. This capex programme is expected to be completed by March 2020. JSW USA plans to use rest of the investment, up to $350 million, to set up a new hot end facility to make their steel “melt and manufacture”.
The Texas facility is located in Baytown, which is just 30 miles away from Houston, which ships finished product via barge, rail and truck. “Our proximity to the Port of Houston gives us easy access to global markets. As a Texas Corporation and an affiliate of India’s Jindal Group with more than 10 MT of installed capacity worldwide, our facilities benefit from our parent’s world class engineering expertise and product know-how,” a JSW official said.
JSW Steel is a part of the diversified $12 billion JSW Group, which has a presence in Steel, Energy, Infrastructure, Cement, Ventures and Sports. JSW Steel is the leading integrated steel company in India with an installed steel-making capacity of 18 MTPA. JSW Steel’s plant at Vijayanagar in Karnataka, is the largest single location steel producing facility in the country with a capacity of 12 MTPA.