Russian giant invests $1.4 bln in Turkey
Posted by meb at March 17th, 2008
Magnitogorsk Iron and Steel Works (MMK), the largest enterprise in the Russian steel industry, partnered with Atakaş Metallurgy Industry And Trade And Port Administration to invest in Turkey’s iron and steel sector. The Russian company’s investment is worth $1.4 billion.
The MMK, which has a market value of $11.1 billion, and Atakaş Group, which employs 700 personnel, laid the foundation of an iron and steel plant, which will begin operations in November 2009. The plant will attain full capacity in 2010 and start producing 2.5 million tons annually.
The investment is the largest one in the sector, as it “starts from scratch,” said Recep Atakaş, chairman of the Atakaş Group. “Although Turkey ranks 11th in the world in iron and steel production, our global market share is just 1.5 percent. Our flat steel production rate is 13 percent of our total steel production. In developed countries, this rate rises to 60 percent. These figures indicate a distortion in the sector,” he added.
There is a large “steel deficit” that nears eight million tons in the Turkish market, said Atakaş, and added, “this deficit costs us $6 billion annually. Considering new investment areas, such as automotives, white goods and the shipping sector, the need for flat steel will increase, which is why we decided to invest in this area with our Russian partner.”
This is the first overseas investment by the MMK, whose turnover in 2006 was $6.4 billion, said Viktor Filippovic Rashnikov, chairman of MMK. “This is not only a strategic investment for us, but it will also contribute in Turkey improving its steel industry. The facility that we have founded will help cover the deficit of flat steel,” he added. The new plant, located in İskenderun’s Payas province, will produce 2.5 million tons of sheet iron per year. It is expected to provide employment for 2,500 workers.
Source: Turkish Daily News
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