The Grey Chronicles

‘Global’ Chronicles

Like the mythical phoenix, NSC rose back from bankruptcy through the acquisition of its plant assets by a subsidiary of Global Infrastructures Holdings Ltd. (hereafter referred as GIHL). GIHL, the sister company of India’s Ispat International Ltd (IIL), acquired NSC through its subsidiary then called Global Steelworks Infrastructures, Inc. (GSII). It officially changed its corporate name to Global Steel Philippines (SPV-AMC), Inc. (GSPI) “reflecting the company’s commitment to the Philippines but also presented a clear, strong, and unified brand presence for Global Steel’s operations in Asia, Africa, and Europe,” as its own press release on  25 August 2005 stated.

Its sister company, Ispat Industries Limited, is headquartered at Mumbai, employs a total of 2000 people and is the India’s leader in special steels market. IIL’s core competency is the production of high quality steel employing cutting-edge technologies and stringent quality standards. It produces world-class sponge iron, galvanized sheets and cold rolled coils, in addition to hot rolled coils, through its two state-of-the art integrated steel plants, located at Dolvi and Kalmeshwar in the state of Maharashtra (IIL’s corporate web site, accessed 10 October 2006). The 1,200-acre Dolvi complex houses the 2.4mtpa hot rolled coils plant combining the Conarc process for steel making and Asia’s first compact strip process. It hosts a 1.4mtpa sponge iron (DRI) plant commissioned in 1994, a 2MTPY blast furnace and a mechanized multi-functional jetty for raw material handling. Kalmeshwar complex houses a 0.5mtpa cold rolling including a galvanized plain/galvanized corrugated (GP/GC) lines and India’s first color coating mill.

After a brief rehabilitation phase, NSC facilities were promptly put into commercial operations in 2005. Mill by mill, the former NSC facilities was operated after a month or so rehabilitation phase.

McLellan Consultants were initially hired in December 2004 to conduct a due diligence and come up with a rehabilitation plan. McLellan’s services were officially terminated by GIHL three days after a plant tour cum due diligence. GIHL sequestered the NSC-Liquidator PFP’s rehabilitation plan and became its own tentative rehabilitation plan. The original PFP-prepared rehabilitation plan, at US$:P53 exchange rate, amounted to P935million (US$18M) for the first stage alone, plus a P530million (US10M) for start-up spares needed to operate the plant in the first quarter, the first year.

GIHL claimed to have spent US$20 million in 2004 even before the deed of sale was finalized, to rehabilitate the plant then promised to invest $15 million in 2005, and another $10 million in 2006 (Philippine Daily Inquirer, 13 September 2004).

The blogs consist of working scenarios for an expat-led management team. It details some of the idiosyncracies of the expats trying to “synergize” a local steel manufacturing plant with their own brand of “expert” management, or to coin a word “indianeering”.


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