Global Steel may buy stake in Tunisian co

MUMBAI: Mittal family-controlled Global Steel Holdings (GSH) is in talks with the Tunisian government to take a strategic stake in the country’s largest steel maker, El Fouladh. Both parties held their first meeting late last month.

The talks are part of the Tunisian government’s attempts to raise resources to fund the company’s expansion. GSH is the holding company of the Mumbai-based Ispat Industries, controlled by Pramod and Vinod Mittal.

The state-owned El Fouladh is one of the only four steel companies in Tunisia and produce about 1,00,000 tonne of billets. Its product portfolio includes wires and bars.

But GSH’s initiatives may not be restricted to the steel industry. According to people in the know, the company is also said to be interested in Tunisia’s tourism and energy sectors. Officials from the company met Tunisian prime minister last month.

Discussions though is in early stages and it will be some time before the details are known, sources said. The development comes amidst a string of international investments announced by GSH within a month. Earlier this week, the company said that it will invest up to $2.8 billion in Bangladesh’s energy sector.

Just a fortnight ago, the company had pledged to put in $1.1 billion in Montenegro’s power and mining industries.

Tunisia, known to have rich energy resources, is among the few African countries where demand for steel is more than the overall production capacity. Imports in the north African country have already more than doubled in the first three months of the year.

Tunisia is also strategically important for GSH as it has operations in neighbouring Libya, where it has a management contract with a local steel company. Sharing of resources, according to people in the know, will be therefore easy. GSH also has operations in Nigeria and Zimbabwe.

At present, GSH has operations in eight countries, spread across four continents. According to various estimates, it handles about 14 million tonne of capacity globally.