MOIL on Friday announced the closure of its joint venture company (JVC), SAIL & MOIL Ferro Alloys (SMFAPL).
SMFAPL was formed in 2008 under 50:50 joint venture (JV) with Steel Authority of India (SAIL). The objective of the JV was to set up ferro alloys/manganese plant at Nandini, Bhilai, Chattisgarh.
"Due to reasons including increase in power cost, the operations are not expected to be viable. Hence, the operations were -not started in SMF APL and as such it has been a dormant company since its incorporation in 2008, the company said.
It added that since the objective of the JV could not be attained, it has been decided to close SMFAPL. Accordingly, the board of directors and the shareholders of SMFAPL have decided to strike off the name of SMFAPL from register of Registrar of Companies under the provisions of section 248 of the Companies Act, 2013.
Since there is no operation in the JVC, there will be no impact on the performance of MOIL on account of closure of JVC, it added.
The board of directors of MOIL had already approved setting up of ferro alloys plant on its own at company's Gumgaon Mine (25000 MTPA) arid Balaghat Mine (50000 MTPA) with total estimated cost of Rs 418.82 crore.
MOIL is engaged in the exploration, exploitation and marketing of manganese ore and products, such as electrolytic manganese dioxide and high carbon ferro manganese alloy. The Government of India holds 53.84% stake in MOIL as on 31 December 2020.
On a consolidated basis, MOIL posted a 7.4% decline in net profit to Rs 51.38 crore in Q3 FY21 as against Rs 55.46 crore in Q3 FY20.
The scrip 2.02% to Rs 146.75 on the BSE. It traded in the range of 143.75 and 151 so far during the day.
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