POSCO puts stability above reform in management overhaul

South Korea’s steel giant POSCO has chosen stability over reform in its latest management overhaul, retaining most chief executives at group affiliates, ahead of the company's proposed corporate restructuring toward a holding company structure.

However, the world’s fifth-largest steelmaker by output on Wednesday recruited outside experts as executives for its new growth businesses such as rechargeable batteries, hydrogen and artificial intelligence.

In the latest executive reshuffle, POSCO has also revived the post of vice chair after nearly three decades to strengthen its steelmaking business, set to be split off and placed under the new holding company.

“We’re pursuing change while ensuring stability to prepare for our corporate restructuring toward a holding company system,” said a POSCO official.

Earlier this month, POSCO said it is splitting the company into a holding company and a separate steelmaking company to enhance the group’s enterprise value and seek new business opportunities.

Last week, POSCO’s board of directors approved the plan, which will be put to a vote for approval at a general shareholders’ meeting in January.

Under the proposal, the new holding company will work as the group’s main investment vehicle, looking for M&A targets and exploring new business opportunities particularly in rechargeable battery materials and hydrogen projects.

Following the separation, the steelmaking unit and other current affiliates such as POSCO Chemical Co., POSCO Energy Co., POSCO Engineering and Construction Co. and POSCO International Co. will be placed under the holding company as subsidiaries.

POSCO Group Chairman and Chief Executive Choi Jeong-woo said last week it will relist the holding company on the Korea Exchange while keeping the separated steel company unlisted to alleviate shareholder concerns over simultaneous parent-subsidiary listings, which could dilute shareholder value.

PROMOTIONS, NEW FACES

In Wednesday’s management overhaul, Kim Hak-dong, president and head of POSCO’s current steel business, has been promoted to vice chairman in charge of the steelmaking business under a new corporate governance system.

Having majored in metal engineering at Seoul National University, Kim mostly worked at POSCO’s two main steelmaking plants, one in Pohang and the other in Gwangyang, as the top field manager.

The company on Wednesday promoted two executive vice presidents to the posts of president in the group management overhaul, which affected a relatively small number of 37 mid-tier executives.

Chon Jung-son has been named a new president for POSCO’s global infrastructure division, which he has led since the end of 2020. Chon is also known to have led a task force to push for the group’s transition into a holding company.

The other executive promoted to the role of president is Jeong Tak, who will continue to work as POSCO’s marketing chief.

To drive the group’s new growth businesses, POSCO hired Yoon Chang-won, a senior researcher at the Korea Institute of Science and Technology (KIST), as the head of its hydrogen and fuel cell research institute.

The steelmaker said it is also launching a future technology research center to foster the group’s new growth businesses such as rechargeable batteries and artificial intelligence.

Write to Jung-hwan Hwang at jung@hankyung.com
In-Soo Nam edited this article.