Posted on 14 Mar 2016
S. Korea’s Dongbu Steel creditors opt to sell off Dangjin plant’s hot-rolled steel electric furnace to Iran
Creditors of Dongbu Steel Co., a cash-strapped steel manufacturer of
South Korea, decided to separately sell off the company’s electric
furnace used for hot-rolled steel production at its Dangjin plant in
western Korea to expedite the plant sale.
According to the
industry and bank sources on Thursday, the Dongbu Steel creditors
including the state-run Korea Development Bank (KDB) and a steelmaker
based in Iran are currently in talks over potential sell-off of the
hot-rolled steel electric furnace at the Dangjin mill that is considered
one of bad assets of the ailing steelmaker impeding the sale of the
plant.
An unnamed official at one of the creditors expects the
separate divesture of the hot-rolled steel electric furnace could
accelerate Dongbu Steel’s overall restructuring effort.
After
the electric furnace is sold, creditors will likely wait until the
latter half of this year to embark on auction for the mill in Dangjin.
Separately,
KDB is said to be considering liquidating the facilities and land of
Dongbu Steel’s Incheon plant with a slim chance for business
normalization if no one volunteers to buy the plant.
