ATI, Tsingshan to form JV
14 November 2017
Allegheny Technologies Incorporated (ATI) has reached a definitive agreement to form an innovative 50-50 joint venture (JV) with an affiliate company of Tsingshan Group (Tsingshan). The JV will manufacture and sell 60 inch-wide stainless sheet in North America. First shipments are expected in early 2018.
The JV will be called Allegheny & Tsingshan Stainless. Tsingshan’s operation in Indonesia is vertically integrated from mining raw materials, including ferronickel and ferrochrome, through refining and casting. Tsingshan will supply the JV with redi-to-roll slabs with reduced raw material cost volatility. The Tsingshan-supplied stainless slabs will be hot-rolled into coils on ATI’s HRPF under a conversion agreement between ATI FRP and the JV. The hot-rolled coils will be finished into stainless sheet using the JV’s DRAP line, which is ATI’s major investment in the joint venture. The JV is expected to add approximately 100 manufacturing jobs in Western PA.
Aerospace & Defense, which represents approximately 50% of sales, will continue to be ATI’s largest market. ATI’s consolidated sales of standard stainless sheet are expected to remain at 10% or lower as a percentage of total ATI sales.