JFE Shoji Trade Corporation announced the execution of a USD 9 million Loan Agreement(the"Loan")with OM Materials(S)Pte Ltd a fully owned subsidiary of OM Holdings Ltd.
OMH is listed on the Australian Securities Exchange with principal office in Singapore,is a leading manganese ore sourcing and alloy producing company with interests of manganese ore mines in Australia and South Africa.JFE Shoji will provide OMS with the Loan as an intention to participate OM Sarawak's Phase 1 Ferro Silicon production facility in Samalaju Industrial Park,Sarawak,Malaysia(the"Project")conducted by OM Materials(Sarawak)Sdn Bhd(OM Sarawak),80%owned by OMS.
JFE Shoji is seeking to secure stable non-Chinese origin supply sources of Ferro Silicon to lessen the current high dependence on China.With OMH's proposal of JFE Shoji's participation in the Project as a strategic partner,JFE Shoji is considering an establishment of a joint venture with OM Sarawak producing approximate 110,000 tons per year of Ferro Silicon expected to be in 2015.
The loan,to be provided by JFE Shoji shall be fully converted into equity upon the establishment of the J/V.Meanwhile,JFE Shoji concluded an off take agreement for 80,000 tonnes per year of Ferro Silicon from the Project with OM Sarawak this August.
JFE Shoji will proceed with the study of participating in the J/V to strengthen our raw materials supply sources for further contribution to JFE Group and to expand business with other domestic and overseas customers.
