J O Steel Holdings, a steel-manufacturing holding company based in the UK, has secured a $692 million credit facility from a consortium of banks and financial institutions led by Saudi British Bank (SABB) to set up an integrated billet manufacturing plant within Ras Al-Khair Industrial City in Saudi Arabia.

The proposed steel mill, which is set to be located north of Jubail on the kingdom’s eastern coast, will have an annual production capacity of 1.8 million tonnes, said the UK company in a statement. The plant is expected to go into commercial production in Q1 2025, it added.

As per the deal, JO Steel Holdings will provide $173 million in equity to be raised through convertible warrants. Each warrant will carry a right exercisable by the holder to subscribe to one equity share against each warrant at a price to be determined at a later stage, to establish the project on an overall debt-to-equity ratio of 80:20.

Representatives from the British firm are expected to sign a land lease agreement to that effect with the Royal Commission for Jubail and Yanbu (RCJY) this month.

The investment is in line with the Saudi government’s National Steel Strategy, which aims to expand Saudi flat steel production according to Saudi Vision 2030.