MMK may invest additional USD 100 million in Turkish subsidiary

OJSC Magnitogorsk Iron and Steel Works (MMK) is exploring the possibility of investing an additional USD 100 million over the medium term into MMK-Metalurji, its Turkish subsidiary, to reduce production costs and increase production efficiency.

Investment projects under consideration include construction of an OxiCup shaft furnace and briquetting plant, to reduce dependency on the correlation between scrap and coil prices, make efficient use of production waste and replace bought-in cast iron with MMK’s own; and modernization of the plant’s hot-rolling mill along with introduction of additional stand, to expand the product range and increase the share of high-margin products.

“We are constantly looking for new ways to substantially increase our current technological and production capacities in Turkey,” MMK CEO Boris Dubrovsky said. “Currently we are working on several projects in our investment portfolio that may see investments of upwards of USD 100 million.”

Further development of MMK-Metalurji is a priority for MMK, as the Group expects a global economic upturn and a recovery in the metals sector, including ferrous metals, in the foreseeable future.

“We see such investments as well-timed and rational during the current phase of the economic cycle,” MMK-Metalurji CEO Vitaly Galkin said.