Magnitorogrsk Iron & Steel Works (MMK) is one of the auction winners for 75 percent in Pakistan Steel Mills Corporation (PSMC). Together with the partners, MMK will pay $362 million for its first foreign asset.
Consortium of Russia’s MMK, Saudi Arabia’s TuwairqiSteel Mills and Pakistani Arif Habib Securities offered the best bid of $362 million for the 75 percent in PSMC at the Friday auction. On the same day, the privatization commission of Pakistan made out a letter that acknowledged the bid as accepted, representatives of the commission said. Under the auction provisions, the partners are to pay 25 percent of the amount within 20 days and settle the remainder in 60 days of the date of the letter.

PSMC’s capacity is 1.1 million tons. The enterprise is located 40km to the southeast of Karachi, it makes flat and profile rolled metal and covers roughly 23 percent of internal market. 2005 sales reached $510 million; net profit was $108 million.

The actual stake of MMK in PSMC is yet unclear. The works will start negotiating the size with partners on receipt of the confirming letter from Pakistani authorities, said MMK briefer Elena Azovtseva. It is worth mentioning that the size of MMK’s share in PSMC will affect its other foreign project that sets forth constructing a $6.6-billion mill in India with annual capacity of 10 million tons of flat. The destiny of this project will directly depend on whether MMK gets control over PSMC, sources with the works said off the record.


Regards,
Sardarzada

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