Bhushan Steel Gets Rs 600 Crore Credit From Westlb

Bhushan Steel, which is setting up cold rolling plant near Mumbai, has secured a long-term loan worth of 150 million euros (about Rs 600 crore) from WestLB, Germany's fourth-largest bank.

"The loan will be used for part-financing Bhushan Steel's cold-rolling plant and for future backward integration," a senior official of WestLB told Business Standard.

The total cost of the proposed cold-rolling- cum- galvanising plant at Khopoli near Mumbai is estimated at Rs 486 crore and would be funded through term loans and internal accruals. The project is expected to be completed by March 2004.

WestLB would be extending Rs 60 crore for the project and rest of the loan would be utilised for modernisation and expansion.

"The loan would be for a duration of eight-and-a-half years and does not have any guaranty from an Indian bank," WestLB official said.

According to a senior official with the Bhushan Steel, ICICI has already appraised the project and sanctioned a term roan of Rs 175 crore.

"The balance amount is being tied up with other term lenders," the official said.

"Sales tax exemption for the proposed project has been extended by the Maharashtra government and we anticipate annual captive consumption of cold rolling of more than a million tonne," he added.

The official also said the Khopoli project located near Mumbai port would provide competitiveness in the export market and increase Bhushan Steel's presence in western and southern parts of the country.