'Restructuring Complete'... Repurchased with Internal Resources
Investment Amounting to 20% of Assets... Declaration of Full-Fledged Growth
Dongkuk Steel is set to repurchase its former headquarters building, Ferrum Tower, which it sold during its 2015 restructuring process, after 10 years. The company, which once let go of this property to improve its financial standing, is buying it back for 645.1 billion won?more than 20% of its total assets?declaring a shift toward "solid and sustainable growth."
On July 25, Dongkuk Steel held an extraordinary board meeting and approved the purchase of Ferrum Tower, located in Suha-dong, Jung-gu, Seoul. On the same day, the company signed a sales contract with Samsung Life Insurance and paid a deposit of 64.5 billion won upfront. The remaining balance of approximately 580 billion won is scheduled to be paid within the third quarter. The purchase funds will be raised through a combination of internal resources and loans from financial institutions.
Exterior view of "Ferrum Tower," the headquarters of Dongkuk Steel Group located in Suha-dong, Jung-gu, Seoul. Dongkuk Steel
Ferrum Tower holds symbolic significance for Dongkuk Steel Group. After relocating its headquarters in 1974 to the former Cheonggye Elementary School site in Euljiro, Dongkuk Steel operated from the same location for over 30 years, until temporarily vacating the premises in 2007 for redevelopment. In 2010, the company completed construction of a new headquarters and moved back in, launching under the new name "Ferrum Tower." The name, derived from the Latin word "Ferro," meaning "iron," was chosen through an employee naming contest.
However, in the mid-2010s, the group faced a downturn in the steel industry and began restructuring. In 2014, Dongkuk Steel signed a financial restructuring agreement with Korea Development Bank and other creditors. The following year, the company accelerated asset liquidation by selling UIEL and Kukje Machinery, and restructuring its heavy plate business. The sale of Ferrum Tower to Samsung Life Insurance in April 2015 was effectively the final piece of the restructuring puzzle. After completing that transaction, Dongkuk Steel exited its creditor agreement two years ahead of schedule.
Since then, Dongkuk Steel has realigned its business portfolio around rebar, structural steel, and color-coated steel sheets, and minimized uncertainties by liquidating overseas subsidiaries and selling the CSP steel plant in Brazil. As a result, the company’s credit rating, which stood at BB+ at the end of 2015, recovered to BBB+ by 2023, while its debt ratio improved from 136.8% to 99.0% over the same period.
This repurchase of Ferrum Tower marks the conclusion of Dongkuk Steel Group’s decade-long business restructuring and signals a transition toward "solid and sustainable growth" for a new leap forward. A Dongkuk Steel representative stated that the company aims to maximize integrated synergy among group companies, including the headquarters functions.
The contract amount for this acquisition (645.1 billion won) accounts for 20.2% of the company’s total assets (3.194 trillion won). Although the scale of the investment appears aggressive, it is considered a strategic decision, as it enables Dongkuk Steel to pursue both improved profitability and diversified asset management.
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