Chongqing Iron & Steel Co. agreed to co-operate with South Korea’s Posco in two steel ventures that will attract investment of 6.2 billion yuan ($998 million).
Chongqing will take the lead on a cool-rolling steel project, in which it’ll be the controlling shareholder and operator, the Chinese company said in a statement Monday. Posco, South Korea’s largest mill, will contribute 10 percent to 25 percent of the investment amount.
For a second, galvanizing steel project, Posco will be the controlling shareholder and operator, contributing 51% of the investment amount and Chongqing the rest.
The joint venture companies will produce a combined 2.4 million metric tons of steel a year for cars and home appliances. Both will be based in Chongqing, southwest China.
The agreement remains subject to approvals by the companies and relevant authorities, Chongqing said. The company suspended trading in Hong Kong on Aug. 3.