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The group has yet to disclose official information about the capacity of the steel manufacturing project. Previously, the board of directors expected the steel plant to have an annual output of six million tonnes.
Hoa Sen Group will hold an extraordinary shareholders’ meeting on September 6 to seek shareholders’ approval to take over the project.
Constructing the steel complex will help Hoa Sen to overtake Hoa Phat Group as the largest Vietnamese steel producer, following only Taiwanese Hung Nghiep Formosa Ha Tinh Steel Co., Ltd., which has an annual capacity of 7.5 million of tonnes in the first phase.
On August 2, the group established five enterprises with the total investment capital of VND250 billion ($11.23 million) to support the implementation of the steel project.
Accordingly, Hoa Sen registered 26 business sectors for these five enterprises, including manufacturing iron, steel, cement, and wood products, and exploiting wood, ore, chemicals, among others.
In response to concerns about the heightened risks of environmental pollution in case the steel complex comes into operation, Truong Thi Lieu, deputy director of the Ninh Thuan Industrial Zones Management Authority (NITHIZA), said that if the project is licensed to implement, the investor will have to conduct an environmental impact assessment report and the NITHIZA will co-operation with the provincial authorities to monitor the investor’s implementation of environmental protection regulations. However, it is still the case of “wait and see” whether the investor would comply with environmental protection regulations.
Back in September 2008, the Ca Na IP-based steel complex with the annual production capacity of 14 million tonnes was licensed by a joint venture of state-owned Vietnam Shipbuilding Industry Group (Vinashin) and Lion Group from Malaysia.
The joint venture registered $9.8 billion in the total investment capital for this complex, which became the largest foreign-invested project licensed that year. The construction started two months after its investment certificate was issued. The investors promised to complete the first phase by the end of 2011.
However, financial troubles of both partners forced Lion Group to withdraw from the project. In 2011, the NITHIZA announced to revoke the investment certificate of Ca Na steel complex.
A year ago, chairman of Hoa Sen Group Le Phuoc Vu met with the Ninh Thuan People’s Committee and expressed interest in reviving Ca Na steel complex.
Established in August 2001, Hoa Sen Group is one of the leaders in terms of steel sheet production and trading business in Vietnam and Southeast Asia. The group’s products are currently making up 40 and 20 per cent of the domestic steel sheet and steel markets, respectively, and its products are present in over 60 countries and territories around the world.
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