Relocation of Posco Holdings' headquarters to Pohang approved

Posco Group Chairman Choi Jeong-woo speaks during the general shareholder meeting held in Gangnam District, southern Seoul, Friday. [POSCO HOLDINGS]

Posco Holdings will relocate its headquarters from the current Gangnam site in southern Seoul to Pohang, North Gyeongsang.

The relocation was approved in the general shareholder meeting held at Posco Center building in Gangnam, Friday, after the company promised to move its headquarters back to Pohang in February last year.

The National Pension Service (NPS), which is the largest shareholder of Posco Holdings with 9.11 percent ownership, voted in favor of the relocation.

Posco Holdings was established last year as the holdings company owning Posco, the formerly-listed steelmaker.

Posco subsidiaries, like Posco International and Posco E&C, became subsidiaries of the holding company.

Posco Holdings’ original plan was to place its headquarters in Seoul, but this was met with strong opposition from politicians and civic groups in Pohang, where the steelmaker is headquartered.

The local community’s concern was that headquartering the holdings company in the capital may take resources from Pohang, which is heavily reliant on the steel industry.

During the shareholder meeting, Posco Holdings introduced its plan to set up a task force to improve its corporate governance structure.

The announcement came after the NPS and President Yoon Suk Yeol called for more transparent governance in companies with dispersed ownership.

With dispersed ownership, a company has no single investor with a controlling share of the entity.

President Yoon Suk Yeol mentioned on Jan. 30 that “a stewardship code should be adopted at companies with dispersed ownership,” underlining the importance of governance transparency in companies like Posco and KT.

“Amid the economic slowdown accelerated by the global monetary tightening and rising geopolitical risks, Posco will significantly improve the shareholder value with the management system centered on the holdings company, and continue to grow by upholding eco-friendly values,” said Posco Group Chairman Choi Jeong-woo during the shareholder meeting.

In 2022, Posco Holdings reported a 50 percent on-year drop in net profit with 3.56 trillion won ($2.74 billion), largely due to the shutdown of its Pohang steel mill after flooding by Typhoon Hinnamnor in September.

BY SHIN HA-NEE [shin.hanee@joongang.co.kr]