LG Sangsa Sells Entire 25% Stake in Beijing Twin Towers... Securing Funds for New Business

[Asia Economy Reporter Su-yeon Woo] LG Sangsa has decided to sell its entire 25% stake in the Beijing Twin Tower. Through this, LG Sangsa plans to enhance financial stability and use the funds raised from the sale for new business investments.

LG Sangsa announced on the 10th that it held a board meeting and resolved to sell its entire 25% stake in LG Beijing Twin Tower for 341.2 billion KRW. Having experienced poor performance last year, LG Sangsa aims to improve financial stability by reducing debt ratios through this non-operating asset stake sale.

Completed in 2005, the LG Beijing Twin Tower is located near Tiananmen Square in China, with a total floor area of 150,280㎡ (approximately 45,460 pyeong). It consists of two office buildings with 31 floors above ground and 4 floors underground.

100% of the LG Beijing Twin Tower shares are held by LG Holdings Hong Kong (LG Holdings HK Ltd.), of which LG Electronics owns 49%, LG Chem owns 26%, and LG Sangsa owns 25%.

An LG Sangsa official explained, "The proceeds from this stake sale will be used as necessary funds for new investments, accelerating business promotion. Additionally, we expect positive effects in terms of improving financial structure through enhanced asset management efficiency and securing cash liquidity."

Through this sale, LG Sangsa is expected to create momentum for performance improvement this year. The company has set a strategic direction to minimize risk exposure due to fluctuations in resource market conditions and to advance business structure and stabilize the portfolio in its core energy, industrial materials, and solutions businesses.

As a new strategic business, LG Sangsa is focusing on the development of nickel ore mining in Indonesia. They are planning to secure off-take rights (priority purchase rights) for nickel ore, a key raw material for secondary batteries, as part of preparing future growth engines.

To improve profitability in the palm business, LG Sangsa aims to maximize operational efficiency of palm farms and expand palm oil production and trading volumes accordingly. The annual target production and trading volumes for palm oil this year are 200,000 tons and 320,000 tons respectively, representing increases of 33% and 78% compared to the previous year.

Additionally, LG Sangsa has set a goal to increase the annual production of the Indonesia GAM coal mine to 10 million tons this year. This is a 32% increase compared to the previous year, and LG Sangsa expects the mine’s maximum annual production to reach around 14 million tons by 2022.

Production at the Wantugou coal mine in China is also planned to increase. The annual production target for the Wantugou coal mine this year is set at over 2 million tons, more than tripling last year’s production. LG Sangsa anticipates that once the new coal seam currently under development is completed around the end of this year, annual production of 5 million tons will be possible starting next year.

For coal trading volumes, LG Sangsa aims to increase by 6 million tons from last year to 21 million tons, seeking diversification of coal procurement sources and sales regions. Strengthening the coal trading business is a strategic measure based on the fact that it can generate stable profits despite fluctuations in coal prices compared to mining development investments.

An LG Sangsa official said, "We are making company-wide efforts to secure a foundation for sustainable growth. This year, we will simultaneously secure the company’s profitability and growth potential."

This content was produced with the assistance of AI translation services.