Posco International to absorb Posco Energy

Posco International, the trading arm of the Posco Group, said Friday that its board has approved a bill to absorb Posco Energy.

The merger will be put to the vote at the general shareholders‘ meeting on Nov. 4 and finalized on Jan. 1, the company said in a statement. 100 shares of Posco International will be worth 116 shares of Posco Energy.

Posco International will issue new shares according to the merger ratio and transfer approximately 46 million shares to Posco Holdings, the shareholder of Posco Energy.

After the merger, Posco Holdings will hold a 70.7 percent stake in Posco International.

The decision was made to preemptively respond to changes in the energy market amid the global supply chain crisis, the company said.

Officials expect to establish a complete value chain for the liquefied natural gas business, as Posco International is responsible for the group’s production and trading of LNG, while Posco Energy is in charge of the storage of LNG.

The merger is further expected to strengthen Posco Group‘s competitiveness and facilitate the initiation of eco-friendly energy projects, they said.

By Lee Yoon-Seo (yoonseo.3348@heraldcorp.com)