Sunday, May 16, 2010

3 Underwriter handle Krakatau Steel IPO

PT Krakatau Steel picks PT Danareksa Sekuritas, PT BahanaSecurities, and PT Mandiri Sekuritas to help arrange the initial public offering of PT Krakatau Steel. Krakatau Steel plans to sell 30% of the shares to raise US$600 million from the market.
Krakatau Steel bolsters the target of proceeds from initial public offering (IPO) into US$600 million as from the former plan of US$400 million.
The target could increase as the state corporate assets value might swell after the joint venture formation involving Pohang Iron and Steel Company (Posco), a South Korean steel producer. The soaring asset value could boost up the stock sale price offered to public.
Krakatau Steel and Posco plans to construct an integrated steel plant in Cilegon, Banten, with US$2.7 billion investment. So the company plans to IPO still waits for the joint venture decision here.
The government expects Krakatau Steel could owns 45 percent shares of the joint venture and Posco 55 percent. The ownership here is larger than that of proposed by the Korean steel producer of only 30 percent.

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