POSCO says Nippon to invest in Vietnam steel plant
SEOUL, Oct 28 (Reuters) - South Korea's POSCO (005490.KS) said on Tuesday its Japanese peer Nippon Steel (5401.T) had agreed to invest an undisclosed sum to take a 10 to 20 percent stake in POSCO's cold-rolled steel project in Vietnam.
POSCO, which plans to complete the plant with an annual production capacity of 1.2 million tonnes by September 2009, hopes the project will help it expand into Southeast Asia, where it sees strong growth opportunities.
"The investment is to bolster the alliance between the two companies," a POSCO spokesman said.
The two companies have stakes in each other, a move they have taken to protect against potential hostile takeover bids by third parties, and jointly negotiate with iron ore suppliers for annual term deals.
They are also members of an Asian consortium which agreed earlier this month to spend $3.12 billion to take a 40 percent stake in Brazlian iron ore miner Namisa. [ID:nN16364304] (Reporting by Miyoung Kim; Editing by Kieron Henderson and Jonathan Hopfner)
