Group seeks $1.2bn for steel plant

A subsidiary of Japan's Yamato Kogyo Co and other companies are in talks with banks to raise $1.2 billion for a steel plant in Bahrain, an executive working on the project said on Tuesday.

Yamato Steel Co is working on the project with a Gulf Arab consortium called Foulth, that includes steel and chemical maker Industries Qatar and Kuwait-based Gulf Investment Corp.

The firms are talking to lenders including HSBC, Arab Banking Corp and BNP Paribas to act as arrangers, Khaled al-Qadeeri, head of the manufacturing at Gulf Investment Corp, told Reuters.

The arrangers would likely be mandated after contractors have submitted bids for construction in November, Qadeeri said.

The complex, located near two other steel plants owned by Foulth, will have the capacity to produce 3.5 million tonnes of three types of steel a year, Qadeeri said.

Demand for steel and other building materials is soaring in the Gulf Arab region, where governments are investing more of their record oil revenues in infrastructure and other construction projects.

Other investors in Foulth include Kuwait's National Industries Group and the Kharafi Group, a family-owned conglomerate.

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