South Korean steel giant Posco, the country’s sixth-largest conglomerate, will merge its manufacturing units for key electrodes of lithium-ion batteries and accelerate its carbon business as it looks beyond its traditional steelmaking operations for growth in the age of digitalization and automation, said its CEO.
Choi Jeong-woo, formally inaugurated as the ninth chair of Posco and the first captain from a managerial background instead of metal engineering to run the world’s fifth-largest steel mill, also envisions venturing into the grain trading business and tapping North Korea for mineral sourcing.
“Integration of anode and cathode material units can save R&D and marketing expenses and create synergy,” Choi said in a press conference after a board meeting on Friday.
The merger would bring together cathode-making Posco ESM Co. and anode-producing Posco Chemtech Co., a chemical materials unit that Choi previously headed.
Cathode and anode are two of the four core materials that make up rechargeable batteries, whose applications range from electric vehicles to IT and mobile devices. The steelmaker has recently been making a push in the materials business for secondary batteries whose demand is expected to surge in the automated and electric mobility age.
The new chief vowed to generate 15 trillion won ($13.5 billion) in sales from the new materials business to command a market share of 20 percent by 2030.
Choi also announced plans to spur the raw material businesses of lithium and synthetic graphite. He said the company is also considering the carbon materials business as part of efforts to add value to steel mill byproducts.
Regarding possible ventures in North Korea amid the recent reconciliatory mood, Choi raised the possibility of tapping into the country’s vast mineral reserves such as magnesite and natural graphite. While Posco currently imports all of its magnesite from China, he noted that North Korea’s magnesite deposits are the second largest in the world and mentioned Posco Chemtech’s magnesite development project in the North’s port city of Tanchon in 2007.
Choi also announced the launch of a corporate-citizen committee, an entity composed of executives as well as outside directors and experts to bolster corporate governance, transparency and social responsibility.
By Woo Je-yoon and Kim Hyo-jin
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