POSCO Close to Purchase Dongbu Assets

POSCO is expected to take care of a steel mill and power plant owned by troubled Dongbu Steel, a major steelmaker in the country whose technology the government believes must be owned by the country and is therefore obligated to sell its distressed assets. only a South Korean company.

Officials from POSCO, the country's leading steel company, completed a lengthy inspection of the two facilities last week. They did not expand on the fact that it is not profitable for POSCO, which is also undergoing a radical restructuring in the face of declining profits and debts, to take these objects. It is rumored that POSCO will be able to buy them for one trillion won, which is $ 980.1 million. A public relations officer at POSCO said: "There is nothing definite at this point. The company will soon make a decision based on the results of the audit."

Experts say POSCO is feeling pressure to lead the country's steel industry and is committed to supporting the restructuring of Dongbu. Separately, there was a message that POSCO is close to buying assets. POSCO will be able to buy the assets through a series of complex financial transactions set up by the Korea Development Bank, Dongbu's main lender.

POSCO announced a restructuring plan last month as its earnings have been declining for the past three years. She said she would cut her investment budget by about two-thirds by 2016 and focus on three main areas - steel production, renewable energy (fuel cells) and specialty materials (lithium and nickel). The company wants to close all non-core segments.