JSW Steel, the steel manufacturer, has begun talks to acquire Welspun Maxsteel for about Rs 1,000 crore.

The steel manufacturer is looking forward to acquiring Welspun Maxsteel, with a view to sourcing cheaper raw material, cutting production costs, and strengthening its presence in the northern and western market.

The acquisition will help JSW to source raw materials at a cheaper rate for its various steel plants.

Apart from this, JSW Ispat has set up a three million tonne steel plant at Dolvi, in Raigad district of Maharashtra, which purchases sponge iron and raw material to make high grade steel from its nearby Welspun Maxsteel plant. JSW Ispat plans to expand its Dolvi plant capacity to five million tonne.

The group is expanding its capacity at Dolvi plant to supply steel in the western and northern markets. The company has also invested heavily to complete its pellet, coke oven and captive power plants to cut down production costs.