Finland-based stainless steel producer Outokumpu has announced that it has completed divestment of a 55 percent stake in the joint venture Shanghai Krupp Stainless Co., Ltd (SKS) to China-based Lujiazui International Trust Co., Ltd. SKS is a Shanghai-based joint venture between Outokumpu and Baosteel, which up to now have held 60 percent and 40 percent stakes respectively. SKS has a cold rolling capacity of 290,000 mt per year and employs over 450 people. Following the divestment, Outokumpu still holds a five percent share of SKS and continues to operate the cold rolling mill.
The transaction cash value of the divestment is about €370 million, with net cash proceeds of approximately €350 million. As a result of the transaction, Outokumpu’s net debt decreases by approximately €430 million. Outokumpu will record a non-recurring capital gain of approximately €330 million in its fourth quarter results.