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While official details of a partnership between South Korea’s largest steelmaker POSCO Holdings Inc. and Cleveland-Cliffs Inc. may not be revealed until the first quarter of 2026, the Korea Economic Daily reported on Saturday November 1 that POSCO is expected to invest $700 million in the American steelmaker.
“With the partnership, the [South] Korean steel conglomerate is expected to invest more than 1 trillion won, or over $700 million, to acquire at least a 10% stake in the US steelmaker by next year, according to people familiar with the matter on Friday [October 31],” the South Korean news organization reported.
US steel sources said the news provided a window into the scope of the partnership.
“I do not think it will have much bearing on Cleveland-Cliffs’s normal course of business,” a US steel distributor said.
“I feel the [South] Koreans did it to show good faith to the [US President Donald] Trump Administration that they are investing in [the] American industry and are being a business partner instead of an adversary,” he added.
For Cleveland-Cliffs, “10% is not enough to demand many changes. I feel it’s a good-faith investment,” the distributor said.
Neither Cleveland-Cliffs nor POSCO USA responded immediately to requests for comments on the South Korean news report.
Cleveland-Cliffs announced the partnership with POSCO on Thursday October 30 when it was heralded by steel industry sources as a financial lifeline for the integrated steelmaker, following a $234-million loss in its third quarter with its last full-year profitability in 2023 when it earned $450 million.
The Cleveland, Ohio-based steelmaker announced POSCO is the “strategic partner” referenced, but not identified, in a memorandum of understanding (MoU) cited on October 20 during Cleveland-Cliffs’ third-quarter earnings call.
The MoU was executed on September 17 between Songwon Shin, POSCO’s head of corporate planning and the finance division and Celso Goncalves, executive vice president and chief financial officer at Cleveland-Cliffs, the US steelmaker stated last month.
The partnership will allow POSCO, South Korea’s largest steelmaker, to support and grow its established US customer base while ensuring that its products meet US trade and origin requirements, Cleveland-Cliffs stated.
The Korea Economic Daily reported that the investment in Cleveland-Cliffs would give POSCO immediate access to steel made in the US without waiting for its facilities in Louisiana to be completed and come online in 2029.
POSCO and Hyundai Motor Corp announced last April they will jointly build a $5.8-billion steel plant in the US. Hyundai owns the second largest steel maker in South Korea, Hyundai Steel.
The plant will have a capacity of 2.7 million tons of steel per year.
Cleveland-Cliffs has an annual raw steel production capacity of about 23 million net tons with plants in Kentucky, Indiana, Illinois, Ohio, Michigan, Pennsylvania, West Virginia and North Carolina, as well as Ontario.
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