POSCO buys stake in Chinese firm

Thursday, Jun 24, 2010

- Deal gives steelmaker wider access to rare-earth resources

POSCO-China, along with Korean Resources Corp, have acquired a 60 percent stake in China`s Yongxin Rare Earth Metal Co., a Chinese producer of minor metals.

According to POSCO, the Chinese unit of the steelmaker and the state-controlled exploration company jointly purchased the stake for 59.76 million yuan (11.05 billion won). POSCO-China won approval from the Baotou City government on June 9, for the validity of the business deal. As a result, POSCO-China now owns a 31 percent stake in the Chinese company, and Korea Resources 29 percent.

Located in the rare-earth mining district of Baotou, Yongxin Rare Earth Metal Co. has produced neodymium, a rare earth element used to make permanent magnets. POSCO-China and Korean Resources plans to renovate production facilities at the Chinese company by November to produce 1,000 tons of neodymium and as much NdFeB every year.

The strongest existing magnetic material in the world, NdFeB is expected to become increasingly sought-after, as it is used to make motors for electric vehicles and wind turbines.
junykim@posco.com

Source: POSCO