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South Korea's Posco signs deal to buy Malaysian steelmaker in first foreign acquisition

South Korea's Posco signs deal to buy Malaysian steelmaker in first foreign acquisition

South Korean steelmaker Posco said Wednesday it has signed a contract to buy a controlling stake in a privately held Malaysian steelmaker in its first overseas acquisition.
Posco said in a regulatory filing that it was buying the 60 percent share in MEGS Industries Sdn. Bhd. for 52.29 million ringgit (US$15.6 million; euro10.9 million).
In a separate statement, Posco said it would assume management control of the company when the stock purchase is completed in early 2008.
Posco in the statement also said that the acquisition would be its first of an overseas steel company. Spokeswoman Ko Min-jin also said it marked the first foreign acquisition of any kind for Posco.
MEGS, based in Klang, near Kuala Lumpur, has an annual production capacity of 120,000 metric tons of electrolytic galvanized coil, Posco said.
Posco spokeswoman Ko said that South Korea's Daewoo International Corp. would buy a 10 percent stake in the company while the remaining 30 percent would remain in the hands of MEGS Chairman Zaid Ibrahim.
Ko said that electrolytic galvanized coil is used in products such as consumer electronics and automobiles. She said that Posco plans to supply the coil to a Samsung Electronics Co. plant in Malaysia.
Posco said the acquisition will help increase its presence in southeast Asian markets.
Shares in Pohang, South Korea-based Posco closed unchanged at 575,000 won (US$616; euro426) Wednesday. The company's stock price has surged 86 percent this year.


Updated : 2021-08-04 05:06 GMT+08:00