POSCO accelerates sale of non-core businesses in China and Vietnam

South Korea’s POSCO is accelerating the restructuring of its non-core overseas subsidiaries, continuing the sale of its electrical steel division in China and its construction subsidiary in Vietnam. This was reported by Business Korea.

According to sources in the investment banking industry, POSCO International agreed at the end of last week to sell 100% of its stake in Suzhou Pohang Special Steel to China’s Guangdong WCAN Magnetic Material. The deal is expected to close on June 30 and is valued at approximately $28.9 million. The Suzhou-based company is engaged in the processing of electrical steel and the production of engine components in eastern China.

It is reported that POSCO International has decided to exit the Chinese steel market due to its oversaturation, which makes further competition with local players unprofitable. In addition, geopolitical risks, including trade tensions between the US and China, are worsening the business environment for South Korean conglomerates operating in China.

At the same time, POSCO E&C is also negotiating the sale of its Vietnamese subsidiary. Auto parts manufacturer S.I. Casting has been selected as the main contender for the purchase, and the parties are currently in negotiations. POSCO E&C Vietnam has implemented a number of general construction projects in Vietnam.

These steps reflect a broader strategy to exit low-profit foreign operations and focus resources on fast-growing sectors.

As a reminder, POSCO reduced its steel production by 1.1% year-on-year to 33.17 million tons in 2024. Rolled steel sales during the period decreased by 1% y-o-y – to 32.8 million tons. The decline in production and sales was due to the reconstruction of blast furnaces. However, sales of high value-added products increased despite weak global demand. In 2025, POSCO Holdings plans to continue its restructuring efforts.

As GMK Center reported earlier, POSCO Holdings and Hyundai Motor Group are joining forces to implement a large-scale steelmaking project in the US. The companies have signed a memorandum of cooperation on the construction of a $5.8 billion plant in Louisiana.