Samsung C&T denies split-merger of plant construction business

Samsung C&T on Tuesday denied a local report that it was seeking to split off its loss-making plant construction business and merge it with affiliate Samsung Engineering.

“We’re not considering any split-off or merger as suggested by the report,” the Seoul-based firm said in a regulatory filing.

Chosun Ilbo, a daily newspaper, reported Monday that Samsung Group was pushing for the split and merger as part of its on-going efforts to realign its portfolio and retreat from noncore, unprofitable business. It said the group will ultimately seek to sell Samsung Engineering.

Samsung C&T’s plant construction business, with annual revenue of about 2 trillion won ($1.7 billion), is a major burden on the firm’s bottom line, with its mine construction project in Australia alone running 1 trillion won in losses so far.

Samsung Engineering last year logged an operating loss of 1.45 trillion won on revenue of over 6 trillion won.

By Lee Sun-young (milaya@heraldcorp.com)