[Courtesy of Hyundai Steel]
South Korea approved the voluntary fast-track restructuring of two more steel producers Tuesday through state support to reduce overcapacity following a sweeping overhaul of shipbuilding and shipping industries.
The Ministry of Trade, Industry and Energy said that Hyundai Steel Co., a unit of the Hyundai auto group, and Dongkuk Steel Co. gained government approval to go ahead with corporate restructuring in return for incentives and financial support.
Last month Histeel Co., which specializes in steel pipes, became the first steel company to conduct spontaneous restructuring in return for fast-track administrative procedures, exemptions from regulations, and tax benefits under a law called One-Shot Act.
Dongkuk offered to sell a thick plate plant in the southeastern city of Pohang and focus on high value-added products.
Hyundai Steel suggested it would sell its ingot electric furnace in the western port city of Incheon and increase its investment in high-quality forged products in the southern city of Suncheon.
A global glut and oversupply mainly from China, the world's biggest producer, has forced consolidation in the global steel industry.
Despite its pledge to cut as much as 150 million metric tons of capacity by 2020, China continues to export its steel surplus as steel mills there struggle to stay profitable and maintain their market share.
Aju News Lim Chang-won = cwlim34@ajunews.com
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