‘One Shot’ turnaround law aids 10 companies

The government approved restructuring plans by three companies that will become beneficiaries of the so-called One Shot Act, a new law designed to facilitate and speed up voluntary corporate restructuring.

Hyundai Steel, Dongkuk Steel Group and Wooshin Apect will receive a range of state-led support, including tax benefits and subsidies on top of fast-track procedures for mergers and acquisitions under the new Corporate Vitality Enhancement Act, the Ministry of Trade, Industry and Energy said on Wednesday.

There are now 10 local companies benefitting from the law.

Hyundai Steel agreed to sell an electric furnace in Incheon that produced forged steel because that product is in oversupply due to the weakened shipbuilding industry. The steelmaker once had the capacity to produce 25.9 percent of all forged steel made in Korea. Hyundai will now focus on the high-purity iron and high alloy steel businesses.

The Trade Ministry said Dongkuk Steel Group will sell its thick plate steel plant in Pohang, North Gyeongsang, and will invest more in developing environmentally friendly and higher value-added steel.

Wooshin Apect will reduce its facilities that produced aluminum panels and invest more in LEDs.

“We expect four to five more will be approved by the end of this year,” said Kim Jong-chul, a director at the Trade Ministry. Of the 10 beneficiaries approved by the government, four are steel and nonferrous metal companies and two are petrochemical companies.

BY KIM YOUNG-NAM [kim.youngnam@joongang.co.kr]