Wednesday, June 18th, 2014
SEOUL, KOREA - POSCO Group, jointly with the Public Investment Fund of Saudi Arabia, will build an automobile assembly plant in Saudi Arabia with an annual capacity of 150,000 cars. The group will also cooperate actively with construction projects to build social infrastructures such as homes and plants.
According to company sources on June 17, POSCO chairman Kwon Oh-joon met on the 13rd with Abdulrahman M. Al Mofadhi, Acting Secretary General of the Saudi sovereign wealth fund and signed an agreement for mutual cooperation. Earlier in February he had discussed with Mr. Al Mofadhi before being appointed as POSCO chairman for a possible deal to build an auto plant. At the signing ceremony, Daewoo International president Cheon Byeong-il, POSCO Engineering & Construction president Hwang Tae-hyun, and POSCO Capital president Choi Myung-ju were in attendance.
The automobile assembly plant project led by Daewoo International calls for building an assembly plant churning out 2.0- to 2.4-liter mid-sized cars for the Saudi middle class at the cost of US$1 billion. Most of the investment fund will be paid for by the Public Investment Fund. Al Safar Group of Saudi Arabia will be an investor in the project through a special purpose corporation called SNAMC.
Daewoo International will be responsible for the whole project management work including automobile design and parts procurement. POSCO will be charged with supplying steel sheets while POSCO E&C with plant construction. The plant will be up and running by the second half of 2017. In addition to the automobile plant project, POSCO and the Public Investment Fund will work together in the areas of housing development, plant, and pipeline construction projects as well.