Krakatau Steel Exits Osaka Joint Venture in $14 Million Deal as State-Owned Mill Sharpens Turnaround Strategy

JAKARTA, Investortrust.id — PT Krakatau Steel (Persero) Tbk (KRAS) has completed the sale of its entire stake in PT Krakatau Osaka Steel (KOS) to Japan's Osaka Steel Co. Ltd. for $14 million, marking another step in the Indonesian state-owned steelmaker's restructuring program after its joint venture halted production.

The transaction became effective on June 29, with Krakatau Steel transferring all 14,000 Series B shares it owned in KOS, representing 20% of the voting rights and 14% of the company's total issued and paid-up capital, according to a filing with the Indonesia Stock Exchange.

The divestment underscores Krakatau Steel's strategy to streamline non-core assets and strengthen its financial position after years of restructuring. The move also reflects the mounting pressure facing Indonesia's steel producers, which continue to battle low-priced imported steel despite government efforts to protect domestic manufacturers.

Krakatau Osaka Steel had previously ceased all production after struggling to compete with imported steel products flooding the Indonesian market.

The company said Osaka Steel paid the full $14 million purchase price upon signing the share sale agreement, providing Krakatau Steel with an immediate cash inflow.

Following the completion of the transaction, Osaka Steel now owns Krakatau Steel's entire former stake in the joint venture, while KRAS no longer holds any equity interest in Krakatau Osaka Steel.

Krakatau Steel confirmed that the ownership transfer officially took effect on June 29, 2026, in accordance with the execution of the transaction disclosed through its regulatory filing.

The divestment comes as the state-owned steel producer continues to improve operational efficiency and simplify its corporate structure. Earlier this year, Krakatau Steel returned to profitability in the first quarter of 2026, supported by cost-cutting initiatives and operational improvements, although the broader domestic steel industry continues to face weak pricing and intense competition from imported products.