|LS Cable & System CEO Myung No-hyun, third from right, poses with Artha Graha Network Chairman Panji Winata, fourth from right, after agreeing to establish a joint venture in Indonesia at the Indonesian Embassy on Yeouido in southern Seoul, Monday. Indonesian Ambassador to Korea Umar Hadi, first from left, also attended the event. / Courtesy of LS Cable & System|
By Baek Byung-yeul
LS Cable & System will establish a power cable manufacturing joint venture with Indonesian group Artha Graha Network to expand its cable business in Southeast Asia.
The company announced at the Indonesian Embassy on Yeouido in Seoul, Monday, it had agreed to create a joint venture with the Indonesian conglomerate. According to the agreement, the two will invest $40 million to establish a 64,000 square-meter plant near Jakarta by 2019.
The Korean cable company said it will produce mid- to low-voltage cables that transmit power to large-scale industrial sites and commercial buildings.
Artha Graha Network is an Indonesia-based conglomerate that operates in the banking, hotel, resort and construction sectors.
Indonesia has the largest power cable market in Southeast Asia with average growth of 8 percent a year. LS Cable & System expects the plant can generate $100 million in revenue by 2025.
LS Cable & System CEO Myung No-hyun said the joint venture could be accelerated after President Moon Jae-in announced his New Southern Policy during his visit to Indonesia last November.
During a meeting with Indonesian President Joko Widodo, Moon declared his vision to broaden exchanges with Southeast Asian countries to expand Korea's economic influence there.
"Indonesia, which has seen its economy grow strongly, is a very attractive market and we have been looking forward to expanding our business there," Myung said. "After President Moon declared the New Southern Policy last November, negotiations sped up."
With the joint venture, LS Cable & System now has seven cable production companies in Asian countries including Vietnam, China, India and Myanmar. Its subsidiary LS Cable & System Asia is a market-leading cable manufacturing company in Vietnam.