KS, Nippon And Osaka To Build Special Steel Factories

Jakarta, Dec 27 (ANTARA) - State steel maker PT Krakatau Steel Tbk (KS) has agreed with two Japanese steel companies to build factories to produce special steel for automotive and construction industries. KS has signed joint venture agreements with Nippon Steel & Sumitomo Metal Corporation and Osaka Steel Co. Ltd. to build the factories in a land owned by KS in Cilegon, Banten, KS President Irvan K. Hakim said on Wednesday. The joint venture with Nippon Steel & Sumitomo Metal Corporation is PT Krakatau Nippon Steel Sumikin to operate a Galvanizing and Annealing Processing Line (GAPL), he said. The main market target is the domestic automotive industry, Irvan noted. The business is expected to thrive to follow the rapid growth of the country`s automotive industry, he said. KS will have a 49 percent stake in the joint venture with the Japanese partner holding the majority 51 percent stake. PT KS and NSSMC will discuss further details of the cooperation before signing the final deal in 2013, Irvan said. "Operation of the new factory will increase the competitiveness of KS galvanizing technology especially in the provision of basic material for automotive industry," he said, adding the factory will reduce the country`s dependence of import for the basic material. At the same time KS signed a similar agreement with Osaka Steel Co. Ltd. to establish a joint venture named PT Krakatau Osaka Steel. PT Krakatau Osaka Steel will produce small profile steel and steel frame with market target the domestic construction industry. It has also agreed that KS will become a 49 percent shareholder and Osaka Steel Co. Ltd. (OSC) a 51 percent owner of the joint venture company. PT KS and OSC also have yet to discuss details of the cooperation before signing the final deal in 2013. "Operation of the factory will strengthening the position of KS in the market of long products especially profile steel and steel frame for construction," he said. Nippon Steel & Sumitomo Metal Corporation is a publicly listed company in Japan producing steel with a capacity of around 50 million ton of steel per year Osaka Steel Corporation, also a public company is a subsidiary Nippon Steel & Sumitomo Metal Corporation producing billet, steel frame and profile iron with a production capacity of 950,000 tons per year.