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PT Krakatau secures bigger portion in steel JV with POSCO
29/06/2010
The Jakarta Post reported that, after prolonged negotiations, state owned steel maker PT Krakatau Steel has finally secured a bigger portion of ownership in a JV with POSCO.
Mr Mustafa Abubakar state owned enterprises minister said that Krakatau would control 45% of the planned steel plant in Tangerang, Banten, with the remaining shares going to POSCO. He added that the companies would sign a JV agreement by the end of July, two months later than originally planned.
Mr Mustafa said that POSCO will be responsible for 70% of construction costs while Krakatau the rest, as stated in the preliminary agreement in December. He declined to elaborate on why the plant ownership composition did not reflect the initial share of investment as agreed in preliminary negotiations between the two companies.
He said that "POSCO insisted on controlling 70% of the shares, while Krakatau also demanded 45%, so this is a compromise solution for the two companies."
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