Hiap Teck subsidiary in RM650m mill project

KUALA LUMPUR: HIAP TECK VENTURE BHD []'s 55% owned Eastern Steel Sdn Bhd is teaming up with China Shougang International Trade and Engineering Corp for an RM650 million integrated steel mill in Teluk Kalung, Kemaman, Terengganu.

Hiap Teck said on Thursday, July 21 it had entered into an engineering and procurement contract (EPC) and a CONSTRUCTION [] contract with China Shougang.

Based on the statement issued to Bursa Malaysia, the EPC contract price was RM417.83 million while the construction contract price was RM232 million.

Under the contracts, China Shougang would carry out the design engineering and procurement, manufacturing and transportation of equipment, machinery and facilities from China to the site.

Eastern Steel would provide the technical documents and information required by China Shougang.

Under the construction contract, China Shougang would carry out the construction of the plant which includes the civil works, facilities and machinery. Eastern Steel would supply the technical documents and information.

Hiap Teck said the plant was expected to be completed by 2013. The plant would be funded by Eastern Steel shareholders wherein Hiap Teck would finance its 55% portion via a fund raising exercise involving a proposed rights issue and issuance of convertible bonds and its own funds.