Saudi PIF completes $1.1 bln deal to buy 38% Posco stake

04/10/2015 Argaam

Saudi Arabia’s Public Investment Fund (PIF) has completed a $1.1 billion deal to purchase a 38 percent stake in Posco Engineering & Construction (Posco E&C), the South Korean contractor said in a statement.

 

Posco will remain the majority shareholder in the engineering unit, with a 52.8 percent stake.

Posco E&C’s net assets stood at $2.7 billion at the end of 2014, as well as a high-debt burden.

The contractor and the PIF will next establish a joint venture focusing on rail and hotel projects in the kingdom, the statement added.

The deal had faced delays due to corruption allegations at Posco. Earlier this year, prosecutors had investigated the steelmaker and its subsidiaries for the creation of slush funds worth $8.9 million, according to media reports.

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