Krakatau Steel, POSCO sign agreement to build steel plant in Cilegon
Friday, August 6 2010 - 02:31 AM WIB
State owned steel maker PT Krakatau Steel (KS) and South Korea?s steel giant POSCO have finally agreed to form a joint venture to build and operate an integrated steel plant in Cilegon, Banten province, Kompas reported Friday.
The agreement on the establishment of the joint venture was signed in Jakarta on Wednesday.
Krakatau and POSCO will invest up to US$6 billion to build the steel plant, which will be located near KS?s existing plant.
POSCO, the world?s third-largest steel maker, will have a 70 percent stake in the joint venture, while KS will have 30 percent with an option to increase its ownership to 45 percent a year after final acceptance certificate.
The construction of the plant will be divided into two phases. In the first stage, the plant will start the construction of the plant in second semester of 2010 and it expected to be completed in December 2013.
The plant will have a capacity of 5-6 million tons. (*)