- The Poseung Green Power acquisition has been approved… a 63.34 percent stake and management rights have been acquired for 94.95 billion won
- The acquisition bolsters the renewable power generation portfolio… centering around domestic biomass and overseas hydropower
- A step toward becoming a ‘key player in the energy sector with a promising future’… based on a mid-to-long-term strategic mission
LX INTERNATIONAL (CEO Yoon Chun Sung) has finished the acquisition of Poseung Green Power, a company operating a biomass cogeneration plant, and commenced a full-scale push in the renewable power generation business.
Beginning with the acquisition of Poseung Green Power, LX International plans to expand its business across the value chain by further developing the biomass power generation business and reviewing the fuel supply business in addition to promoting eco-friendly power generation such as biomass and hydropower generation in keeping with the company’s strategy.
■ The Poseung Green Power acquisition has been approved… a 63.34 percent stake and the management rights have been acquired for 94.95 billion KRW
On the 19th, LX International announced that the government and financial institutions have approved the buyout to acquire all shares of Poseung Green Power owned by DL Energy in April. After the acquisition, LX International acquired a 63.34 percent stake in Poseung Green Power for 94.95 billion won and secured its management rights.
The biomass power plant of Poseung Green Power is an eco-friendly power plant built in the Asan National Industrial Complex Poseung district in Pyeongtaek, Gyeonggi Province in 2014. The plant can generate up to 43 megawatt-hours (MWh) of electricity per hour by using 250,000 tons of wood biomass such as Bio-SRF and unused wood chips as fuel every year. This is equivalent to a medium-sized facility that can annually supply 100,000 households in Seoul. The power plant also operates a cogeneration energy business that supplies steam to the companies in the Poseung Industrial Complex.
■ The acquisition bolsters the renewable power generation portfolio… centering around domestic biomass and overseas hydropower
The Poseung biomass power plant which began commercial operation in March 2018 recorded 42.8 billion won in sales that year. Last year, it recorded 60 billion won from selling electricity, steam, and renewable energy certificates (REC), stabilizing its business in its fifth year of production. The plant has secured a stable source of sales through long-term REC supply contracts and a stable fuel supply through long-term contracts with biosolid fuel suppliers.
An LX International official commented, “Considering the trend for eco-friendly power generation due to the growing demand for RE100 implementation, renewable power generation is an industry that is expected to grow with stable and continuous demand. With the acquisition of Poseung Green Power, we will absorb the business operation capabilities of new and renewable energy production in Korea. We plan to maximize the plant’s asset value by advancing into the biomass fuel supply business to expand the value chain. Our strategy is to develop the biomass business in Korea and secure additional hydroelectric power assets in Indonesia to reinforce our renewable power business portfolio.”
LX International has been operating private power generation businesses in Indonesia, Oman, and China through overseas investment. In particular, LX International administered the entire process of the Hasang Hydroelectric power plant project in Indonesia from the power purchase contract to power plant construction and operation. The plant is now stably supplying energy to state-owned power companies in Indonesia through a 30-year long-term contract.
■ A step toward becoming a ‘key player in the energy sector with a promising future’… based on a mid-to-long-term strategic mission
Meanwhile, LX International has recently taken the step toward becoming a “key player in the energy sector with a promising future” with the company’s mid-to-long-term strategic mission of “contributing to the growth of the LX Group through innovative new businesses.”
To accomplish this, the company is developing new and renewable power generation along with nickel as one of its key strategies. The company also plans to expand its investment in biomass and hydropower in Korea and overseas to contribute to the advancement of ESG as well as reinforce a stable source of income.
In addition, to secure an additional foundation for future profits, the company is actively reviewing M&As and continuing to pursue new businesses and investment opportunities such as eco-friendly materials and the development and operation of logistics centers that can contribute to the growth of the LX Group. It is also exploring the real possibility of developing the carbon reduction and resource recycling business through monetization.