Finland-based stainless steel producer Outokumpu has announced that it has agreed on the divestment of the remaining five percent stake in the joint venture Shanghai Krupp Stainless Co., Ltd (SKS) to China-based Lujiazui International Trust Co., Ltd. The deal will be completed within the coming months. Outokumpu has recorded the divestment in the fourth quarter of 2015 with an estimated value of €62 million.
In December 2015, Outokumpu completed the divestment of a 55 percent stake in SKS, a joint venture with Chinese steel producer Baosteel, while retaining a five percent stake and continuing to operate the joint venture’s cold rolling mill. In total, Outokumpu has recorded a non-recurring capital gain of €389 million (net of taxes) for the sale of the entire 60 percent share in SKS in its 2015 financial statements.
Meanwhile, SKS, which has a cold rolling capacity of 290,000 mt per year and employs over 450 people, has announced its decision to stop operations due to ongoing losses and extreme pressure in commodity stainless steel products in China. The operations are expected to stop immediately.