Nippon Steel Buys Up Shares in Indonesian Tin Plate Maker

Nippon Steel announced on Wednesday the firm buys up stocks of PT Pelat Timah Nusantra, Indonesian tin plate maker. Nippon Steel aims to expand tin plate business in Asian market where the demand is steadily increasing. Pelat Timah Nusantra sells its stocks by a tender. Consortium by Nippon Steel, Mitsui Corporation, Metal One and Nippon Steel Trading agreeed to ensure Pelat Timah Nusantra’s stocks and singed a buyer-seller contract on Wednesday. Nippon Steel acquires overseas steel company for the first time. Acquisition value is about US$ 60 million as the consortium.

Nusantra is the subsidiary of Kurakatau Steel, Indonesian national steel maker. Nusantra’s capital fund is 101.9 billion rupiah. Nusantra’s production capacity is about 130,000 tonnes per year. Nusantra’s sales were 1.4659 trillion yen in a full business year ended in December 2008.

Indonesian government plans to shift national companies into private. The consortium agreed to ensure Nusantra’s 55% stocks in December. The investment rate is 35% by Nippon Steel, 10% by Mitsui Corporation, each 5% by Metal One and Nippon Steel Trading. Nippon Steel makes Nusantra its consolidated subsidiary.

Nippon Steel continues material supply, cold rolled sheet, to Nusantra and gives technology support. Nippon Steel plans to increase Nusantra’s production capacity to 160,000 tonnes per annum within a few years.

The demand for tin plate is about 16 million tonnes per year globally, growing by 2-3% every year. The demand for food can has expanded along population growth in emerging countries. Indonesian demand is about 170,000-180,000 tonnes per year. Tin plate consumption is 2.3-2.5 kilogram per head in the world while below 1 kilogram per head in Indonesia. The demand is expected to grow highly in the country.