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. Last Updated: 07/27/2016

MMK to Invest in a U.S. Plant

ST. PETERSBURG -- Magnitogorsk Iron & Steel Works plans to invest more than $1 billion building a plant in the United States to supply steel sheet to the automotive sector, its billionaire owner said Wednesday.

MMK, Russia's third-largest steel producer, expects the go-ahead from U.S. authorities by the end of the year to build the plant with a yearly capacity of 1.5 million tons in the state of Ohio, said the company's chairman, Viktor Rashnikov.

"There are a few issues to be decided. We need the approval of the environmental committee," Rashnikov said.

MMK plans to invest more than $5 billion by 2013 increasing the quality and amount of steel it produces.

The company operates Russia's largest single steel plant and, although previous attempts to expand overseas were thwarted, it formed a $1.1 billion joint venture this year with Turkish group Atakas to build a steel complex in Turkey.

MMK Atakas Metalurji Sanayi, owned 50 percent plus one share by MMK, will start producing 2.6 million tons per year of hot- and cold-rolled steel sheet at two locations in Turkey within three years.

MMK produced 12.5 million tons of steel in 2006, or 17.6 percent of the total in Russia, the world's fourth-largest steel producer.

The company, which this week posted a 47 percent rise in first-half net profit to $866 million, will join Russia's three other steel majors in owning U.S. assets should its plant in Ohio get the green light.

Evraz Group bought Oregon Steel Mills last year, Severstal owns the former Rouge Steel plant and Novolipetsk Steel has a joint venture with steel trading firm Duferco that owns U.S. assets, including Pennsylvania-based galvanized-steel maker Winner Steel.