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Southern Steel to form joint venture with Bekaert of Belgium

by wireworld on 05/10/2012 - 05:47 pm

Tag: Press Releases

Southern Steel Bhd is partnering Belgian steel wire producer NV Bekaert SA to set up a joint-venture company, to which both parties will sell their assets worth US$44.6mil (RM135mil).


Southern Steel said in a filing with the stock exchange that the joint venture would be involved in the manufacturing and sales of specified steel wires in Asean.


Southern Steel would have a 45% stake, with the remainder to be held by Bekaert. The sales of the assets would be satisfied via shares in the joint venture company.


The ownership ratio in the joint venture, which initially would see Southern Steel holding a 67% stake following the sale of the assets, would be pared down via a sale of a 22% stake to Bekaert.


The company said its entire stake in wholly-owned subsidiaries Southern Speciality Wire Sdn Bhd and Southern Wire Industries (M) Sdn Bhd, together with its wholly-owned Cempaka Raya Sdn Bhd, would be sold to the joint venture.


Bekaert would sell its entire galvanized and multi-coated wire business in Indonesia currently undertaken by Indonesian subsidiary, PT Bekaert Indonesia, to the joint venture.  Bekaert, listed on Euronext Brussels, is a global player in drawn steel wire products.


The company is technologically strong in advanced solutions based on metal transformation and coatings.  It presently serves customers in about 120 countries.


Southern Steel said the proposed joint venture was subject to the approvals of several authorities in Malaysia, Indonesia and Europe.