FNI abandons $50 million Bataan steel project
MANILA, Philippines — Global Ferronickel Holdings Inc. (FNI) will no longer pursue its plan to put up a $50-million rebar steel project in Bataan as it opts to focus on its existing business interests such as mining and port operations that would bring long-term value for the firm.
FNI said its board of directors was informed by the management of FNI Steel Corp., its wholly owned subsidiary, that the planned FNI Rebar Steel project will no longer push through.
The firm, one of the biggest players in the country’s nickel industry, said the decision was based on a “comprehensive” review of market conditions, capital requirements and the outlook for the rebar steel industry.
“The company believes it is in its best interest to focus on opportunities from its current businesses that offer greater long-term value – nickel ore mining and export, port operations and logistics and ferronickel smelting – which continue to see strong demand driven by the global transition to clean energy and electric vehicles,” FNI said in a regulatory filing yesterday.
Following the business decision, FNI Steel Corp. will begin initiating its de-registration process with the Authority of the Freeport Area of Bataan, according to FNI.
Despite the discontinuation of the steel project, FNI said the project generated value for the company through the acquisition of land that has appreciated in value.
“These assets will be strategically evaluated for profitable use. The company is committed to maximizing value for its stakeholders through continued growth in its current business operations,” the company said.
In 2019, FNI unveiled its plan to invest $50 million to put up a steel processing plant as part of its diversification into other businesses.
The plant will have a capacity of 600,000 metric tons of rebars per year.
Last year, the firm hiked its stake in Mariveles Harbor Corp. (MHC) to 88 percent as its strengthens its hold over the operations of the port.
The investments in the port operator was part of a plan of putting up the steel plant in Bataan province.
In December 2019, FNI acquired a 40.05-percent interest in MHC after it subscribed to 1.67 million common shares at P100 apiece, or P450 million.
Two years later, FNI raised its stake in MHC to 64.03 percent with the acquisition of 23.98 percent interest from NGL for P192 million.
The investment paved the way for the successful operations of its subsidiary, FNI Steel Corp. (FSC), which is putting up a steel processing plant near the terminal.
According to the company, the investment ensures that FSC has easy and steady access to port services since it relies heavily on the importation of raw materials especially during construction.
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