중앙데일리

Sam Dong: Wired for global success

[Korea’s Venture Giants: Fifth in a ten-part series]

Jan 31,2011
Copper summons up images of the distant past. History teaches us that copper brought an end to the Stone Age, and it was used to make weapons in the Trojan War. Familiar home appliances such as copper kettles and pots have long been replaced by cooking utensils made from more advanced materials.

However, copper has entered a second golden age: the age of data communications and a proliferation of electronic devices.

Copper is being used in everything from energy recycling systems to electric cars, said Bok Geo-seong, a specialist in raw materials for the Public Procurement Service.

The ubiquitous use of copper in electronic devices has driven the recent growth of Sam Dong Co., a local firm specializing in copper processing that has built up a steady profit record and a star-studded roster of global corporate clients in just two decades.

Sam Dong Co., based in Eumseong, North Chungcheong, was started in 1977 and incorporated in November 1990.

The company’s fortune has stemmed from successfully producing oxygen-free high thermal conductivity copper in 1994, a first for a Korea company.

Oxygen-free copper refers to a set of pure copper alloys refined to reduce their level of oxygen to 0.001 percent or below, and is superior to other copper alloys in pliability, durability and electric conductivity due to minimal impurities and reduced flaking from oxidation.

Thus, oxygen-free copper is used in a wide variety of fields and devices in which electricity plays a central role, from basic power generators, motors and transformers to key parts in nuclear and solar power plants, electric cars and even high-end headphones.

Developing the technology to locally produce a material with such an open range of applicability has allowed Sam Dong Co. to retain an impressive list of global corporations as its clients.

The company supplies various products such as winding wires made from its oxygen-free copper to General Electric, Mitsubishi, Siemens, Toshiba, ABB, Alstom and Japan AE Power System overseas - and Samsung Electronics, Hyundai Heavy, LG Electronics and Hyosung in Korea.

Most recently, Sam Dong Co. was recognized as an outstanding supplier by Hyundai Heavy last December and Siemens in June.

In order to serve such a far-flung clientele, Sam Dong Co. has invested resources in building, acquiring and renewing copper processing facilities both at home and abroad.

The company has two domestic factories, a flagship facility in Eumseong and another in Mungyeong, North Gyeongsang, first built in 1999.

In particular, Sam Dong finished building an addition to its Mungyeong factory complex last December, adding a structure some 10,000 square meters (107,640 square feet) in size devoted to manufacturing oxygen-free copper.

The new factory has an annual production capacity of 36,000 tons of oxygen-free copper, and applies a manufacturing process originally developed by General Electric called “dip-forming” for the first time in Korea.

Sam Dong also has two facilities in the U.S.

In 2008, Sam Dong built a copper product factory in Rogersville, Tennessee, on land spanning 5,000 square meters. “Insulation products using oxygen-free high thermal conductivity copper are recognized by foreign companies such as Siemens and Toshiba,” Lee Ee-joo, president of Sam Dong Co., said at the plant opening ceremony. “Through entering the U.S., which could be called the mecca of [electric] transformers, [we] will establish a new foothold into the foreign market to become a global company.”

In 2009, Sam Dong made another step in its North American operations by acquiring from British firm Luvata an oxygen-free copper plant in Delaware, Ohio.

Spools of winding wire made from oxygen-free copper at a Sam Dong production plant. Provided by the company

The plant, measuring 17,000 square meters in building space and employing roughly 150 workers as of the end of 2009, served as a keystone for Sam Dong to achieve vertical integration of its operations on the continent.

Having been registered as a venture firm in 1998 by dint of its superior copper-wielding technology, Sam Dong has since then grown to a profitable operation that raked in total revenue of 710 billion won ($636.16 million) in 2009, of which 279.92 billion won came from overseas.

The firm also made a net profit of 20.01 billion won in 2009, the latest official figure available.

This performance was almost double that of 2008, when Sam Dong posted net profits of 10.77 billion won.

The size of its workforce has grown considerably, with employee numbers swelling to 651 in 2009 from just 268 in 2006.


By Lee Jung-yoon [joyce@joongang.co.kr]



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