Osaka Steel Co., Ltd.
Notice Regarding Suspension of Operations of Consolidated Subsidiary
Osaka Steel announced the suspension of operations of its consolidated subsidiary PT.KRAKATAU OSAKA STEEL, with production ceasing on April 30, 2026, and business termination scheduled for June 30. The company will withdraw from its Indonesia business and expects to record losses.
Key Figures
- Capital of PT.KRAKATAU OSAKA STEEL: 100 million USD
- Ownership ratio: Osaka Steel 86%, PT KRAKATAU STEEL (PERSERO) Tbk 14%
- Planned suspension dates: Production suspension on April 30, 2026; Business termination on June 30, 2026
AI要約
Overview of Suspension of Operations of Consolidated Subsidiary
Osaka Steel Co., Ltd. has resolved to suspend operations of its consolidated subsidiary PT.KRAKATAU OSAKA STEEL (KOS). KOS is a joint venture with Indonesia’s PT KRAKATAU STEEL, commencing commercial production in 2017. Although it became profitable in 2021, deficits have persisted since 2022. Due to a sharp decline in demand following the Indonesian government’s infrastructure budget cuts in early 2025 and ongoing structurally negative free cash flow, the company determined that continuing the business was impractical and decided to withdraw. Production is planned to cease on April 30, 2026, with business termination on June 30, 2026.
Future Outlook and Impact
Losses associated with the withdrawal from the Indonesia business are expected to be recorded; however, the timing and amount remain uncertain at this point. Discussions with the joint venture partner, Krakatau Steel, are ongoing, and disclosures will be made promptly once decisions are finalized. Osaka Steel holds an 86% stake in KOS and has directors concurrently serving as employees, as well as personnel secondments. There are transactional relationships, and KOS qualifies as a related party as a consolidated subsidiary.
