POSCO Group is considering selling POSCO Zhangjiagang Stainless Steel (PZSS) in China, a stainless steel plant to penetrate the Chinese market.
PZSS is POSCO’s only steel plant in China. The plant has an annual crude steel production capacity of 1.1 million tons.
The reason POSCO is considering the sale of PZSS is due to continued losses. Last year, it recorded an operating loss of USD 130M (approximately 180 bn won), making it the major loss among POSCO’s 38 overseas subsidiaries.
The plant’s profitability has deteriorated due to an oversupply of stainless steel in China. Currently, the stainless steel production capacity of 43 Chinese steel companies stands at 28.21 million tons, exceeding consumption (24.17 million tons).
POSCO is currently accelerating the restructuring of low-profit and non-core assets at the group level. The company plans to sell or dispose of 125 businesses and assets by 2030, having completed 21 restructurings by Q3, raising 652.4 bn won in cash.
