August 22, 2008

TKC to buy new blast furnaces

TKC Steel Corp announced that it has completed negotiations with a firm in China for the purchase of two blast furnaces for CNY 11.5 million for its operating units Treasure Steelworks Corp at Iligan City in Philippines and Zhangzhou Stronghold Steel Works Co Ltd in Fujian province of China. TKC expects the blast furnaces to start operating by the fourth quarter of 2008.

TKC said that "Upon installation and full operation, these facilities will increase the present installed capacity of Treasure Steelworks Corp. from 300,000 tonnes to approximately 600,000 tonnes annually.”

It will source the funds for the acquisition from the net proceeds of its planned follow on offering in November that was estimated at a maximum of PHP 2.7 billion. TKC Steel will sell up to 235 million shares at a price range of PHP 8 to PHP 11.50 each. First Metro Investment Corp. was tapped as financial adviser and lead underwriter for the offering.