AGPA established in Singapore by Posco International

A palm plantation owned by Posco International's subsidiary BIA in Indonesia [POSCO INTERNATIONAL]

Posco International established a company in Singapore to use as an entity for holding and purchasing palm oil investments.

AGPA, wholly owned by Posco International, was incorporated in Singapore in early November. The decision was approved by the company's board in late October.

Posco International is currently in the process of transferring the 85 percent stake it owns in Indonesian palm oil company BIA to AGPA. The transfer will be completed by end of year.

The newly established Singaporean company will acquire more palm plantations and invest in factories to refine palm oil and produce bio fuel.

According to Posco International, operating the palm oil business through an Indonesian corporation made it difficult to expand business.

Singapore was chosen as the location since the country is home to many palm oil refiners, including Wilmar and Golden Agri Resources. It is a hub for major financial and logistics companies, which would make business and management easier, according to Posco International.

"The food business is a one of the biggest growth drivers for our company, along with steel and energy," said a spokesperson for Posco International. "We plan to develop the Singaporean company so it can operate palm oil related business on its own and grow as a major food business company in Asean."

BY LEE TAE-HEE [lee.taehee2@joongang.co.kr]