House approves KS? IPO plan

State-owned steel maker PT Krakatau Steel (KS) has won a parliamentary approval for the company?s plan to launch an initial public offering (IPO).

The House of Representatives' Commission XI had approved the steel company?s plan to sell up to 30 percent of its shares to the public, deputy chairman of the commission, Asman Abnur said on Thursday.

?The time will be decided by the government later,? he said.

KS plans to use proceed from the IPO to add production capacity so that it would be able to take the advantage of the surging steel demand in Indonesia. The company may spend Rp16.4 trillion (US$1=Rp 9,400) in three years to 2011 for the expansion, according to the government filing Thursday.

KS is expected to produce five million tons per year by 2011 to meet domestic steel demand. (*)