POSCO seeks to attract investors to Roy Hill stake
SEOUL (Reuters) - South Korean steelmaker POSCO (005490.KS: Quote) is looking for strategic investors in the $1.45 billion stake it has in Australian's iron ore project, Roy Hill, a spokeswoman said on Friday.
The company is seeking investors for the 2.5 percent stake out of the 12.5 percent it has, said POSCO's Kim Ji-young, as the steelmaker is tightening its belt in response to the prolonged downturn in the steel industry.
POSCO, the world's fourth-biggest steelmaker, has been looking to boost its access to iron ore and coal used to make steel, including taking a 15 percent stake in the $10 billion Roy Hill project early this year.
But the company in April sold a 2.5 percent stake in Roy Hill Holdings to China Steel Corporation 2002.TW for 359.9 billion Korean won ($331.54 million), leaving it with a 12.5 percent stake.
The Roy Hill project is led by 70 percent stakeholder Hancock in Australia. POSCO, Japanese trading company Marubeni Corp (8002.T: Quote), South Korea's STX Corp 011810.KS, and Taiwan's China Steel Corp 2002.TW are among the other stakeholders.
Shares in POSCO, backed by Warren Buffett's Berkshire Hathaway (BRKa.N: Quote) BRKb.N, were up 0.3 percent in a flat broader market .KS11 as of 0051 GMT on Friday. It has fallen nearly 10 percent this month, as brokerages downgraded its earnings outlook for the current quarter.
($1 = 1085.5500 Korean won)
(Reporting by Hyunjoo Jin; Editing by Jeremy Laurence)
© Thomson Reuters 2017 All rights reserved.