이 기사는 2021년 12월 03일 08:09 thebell 에 표출된 기사입니다.

South Korea's largest stealmaker Posco is considering spinning off the company to set up an investment holding firm.

The steelmaker plans to discuss the plan to shift to a holding company system at its board meeting slated for December 10 and, if passed by the board, put it to a vote at a shareholders’ meeting in January, according to industry sources.

Posco is said to prefer an option to spin off the company into a steelmaking business entity and an investment holding company. The holding company will then buy a stake in a steelmaking unit to completely shift to a holding company structure. Following the shift, the business entity and other affiliates will be placed under the new holding company as subsidiaries.

Through this way of separation, Posco will distribute shares of new companies to its existing shareholders on a pro rata basis.

Under the country’s amended fair trade law, effective from December 30, a holding company has to own at least 30% of its listed subsidiaries, up from the current 20%.

Posco currently controls Posco Coated & Color Steel with a 56.87% stake, Posco Chemical with 59.72%, Posco International with 62.91%, Posco Energy with 89.02%, Posco ICT with 65.38%, Posco Engineering & Construction (Posco E&C) with 52.8%, and Posco M-Tech with 48.85%.

Stakes in these subsidiaries are likely to be placed under the new holding company. As its shareholding in them already exceeds 30%, the holding company won’t need to purchase additional shares.

The key to the separation is treasury shares that Posco currently owns. During the spin-off process, the company may restore voting rights of the treasury stock. Posco’s treasury shares are about 13% of its total outstanding stocks as of the end of September.

A split-off is also a possible option, in which the investment holding firm will wholly own the business entity. Existing shareholders will own the new holding company only.

The biggest benefit of this option is that Posco will not need to purchase shares in the business entity. In the longer term, Posco may also be able to raise funds by taking the business entity public and use the proceeds for new investments.

The split-off option is expected to face strong backlash from existing shareholders, including the National Pension Service which holds a 9.75% stake in Posco and Citibank with a 7.3% stake, as they won’t be able to own shares in the steelmaking unit. Posco Group generates nearly 90% of its operating profit from its steelmaking business. (Reporting by Eun-a Jo)