Qatar Steel shelves plans to borrow $1.34bn

Qatar Steel, a subsidiary of state-controlled Industries Qatar, said on Thursday it would postpone plans to borrow $1.34 billion because of turmoil in global credit markets.

Qatar Steel is the latest Gulf Arab firm to shelve borrowing plans after defaults on US home loans raised corporate financing costs around the world in July and made banks more reluctant to lend.

Qatar Steel had been planning to use the cash to refinance debt and for expansion.

"The expansion project is still viable and negotiations with various contractors are proceeding...," the company said in a statement on the Qatar stock exchange.

Another Industries Qatar unit, Qatar Fertiliser, is likely to postpone a sale of bonds to finance a chemical plant because of the credit crisis, an executive of the group's parent, state-owned Qatar Petroleum, told Reuters last month.

Qatar Steel made a profit of 658 million Qatari riyals ($180.9 million) in the nine-months to September 30, an increase of 53% over the year-earlier period, according to Industries Qatar data.

It sold 1.23 million tonnes of the steel during the period. - Reuters

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