Govt approves NMDC-SIIL merger

The country's largest iron ore producer NMDC today said the government has approved the merger of secondary steel producer Sponge Iron India (SIIL) with itself.

"The Ministry of Corporate Affairs (MCA) has passed an order for merger of SIIL with NMDC on January 18, 2010," the company said in a filing to the Bombay Stock Exchange today.

The Ministry had convened a hearing last November to ally fears, if any, of shareholders or any related parties on the proposed merger. The company had expected to close the merger deal last October.

Meanwhile, the company is conducting a fresh financial viability study of SIIL for its proposed Rs 1,200-crore investment in the firm.

 

The government in May 2008 had cleared the merger of SIIL with NMDC, under which SIIL would get financial support and assured supply of iron ore from NMDC.

The merger got the shareholders' approval in June 2009.