DMCI Holdings led by bilyonaryo Sid Consunji has dropped the axe on its steel making plant in Calaca, Batangas, a victim of the COVID-19 pandemic.
DMCI made the decision last October to close down the P900 million steel fabrication plant, which commenced operations eight years ago.
D.M. Consunji Inc., a DMCI subsidiary, told Bilyonaryo.com cited “a prolonged decline in demand and unsustainable operational costs, attributed to the COVID-19 pandemic (which broke out in March 2020) and its subsequent impact on the Philippine construction sector” for the steel plant’s closure.
“This decision was the result of an extensive evaluation of market conditions and a rigorous assessment of all viable alternatives. We are currently exploring several business prospects to leverage the existing infrastructure and generate new growth opportunities for our stakeholders,” D.M. Consunji said.
Based on its press release, he state-of-the-art steel was built to fabricate heavy steel sections for power plants, infrastructure and steel vertical structures.
The plant, which had a capacity of 2,000 to 3,000 tons a month, was meant not only to provide DMCI’s needs but also the steel requirements of other firms involed in PPP (Public-Private Partnerships) infrastructre projects.
“The idea to set up a steel fabrication facility came about in April 2013. We did market and business case studies for a couple of months before breaking ground in November 2014,” Consunji said.
“Right now, we are completing the ancillary building structures while our fabrication operations are ongoing,” he added.
Consunji said the facility currently supplies the requirements of the DMCI Group but plans are underway to secure sales contracts with other industrial and construction companies.
“We put this up in anticipation of the growth of the country’s PPP infrastructure projects,” he said.
Despite dropping the steel business, Consunji’s appetite for expanding into allied construction enterprises remains undiminished. DMCI is currently in discussions to acquire Cemex Philippines’ cement operations.
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