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KRAS injects IDR 3.81 trillion to Krakatau Posco

20 January 2022 05:55

JAKARTA. PT Krakatau Steel Tbk (KRAS) announces the plan to channel another capital investment of IDR 3.81 trillion in PT Krakatau Posco (PTKP), a joint venture established alongside a South Korea-based steel manufacturer, Posco.

This capital injection is a follow-up to the Memorandum of an In-Kind Transaction Procedure Agreement (MITPA) signed by Kras and Posco on December 31, 2021. In the said contract, they intended to enhance the partnership regarding the roadmap of the construction of a steel manufacturing plant cluster with a capacity of 10 million metric tons in Cilegon.

After increasing the capital, KRAS’s potion in PTKP will also shift higher to 50%, according to the official release. Prior to this, KRAS only had 30% of PTKP’s shares worth IDR 2.84 trillion. The remaining 70%, equal to IDR 65.23 trillion, belonged to Posco.

The capital injection will be channelled out in the form of fixed assets owned by KRAS. These assets include several land plots with a total area of 247.7 thousand square metres and its Hot Strip Mill (HSM) 2 plant in Cilegon.

For the record, this current equity participation channelled to PTKP is equal to 65% of KRAS’s total equity. Therefore, the company needs to gain approval during the Extraordinary General Shareholders Company held on February 25, 2022. (KR/ZH)

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