South Korea: Hyundai Steel, South Korea's second largest steelmaker, has announced plans to sell off its Beijing unit - Hyundai Steel Beijing Process. This decision was spurred by the combined effect of years of sluggish sales and the shrunken market share of Hyundai Motor and Kia cars in China.

The company will be keeping their Tianjin unit for its business dealings in China however but has already filled out a memorandum of understanding with a potential buyer for the Beijing plant. Pre-acquisition due diligence is expected to be conducted soon, and the official from Hyundai Steel stated that the sale should be finished during the first half.

Hyundai Steel Beijing has announced that their assets are currently estimated at 464.8 billion won ($355 million). Of that total, real estate accounts for 382.3 billion won as per the company's regulatory filing. The final deal size is yet to be determined, with the due diligence process yet to begin, according to an official statement.

Hyundai Steel Beijing Process was constructed in 2002, located near car manufacturing facilities owned by Hyundai Motor and Kia Motors. It provided Steel products to the car plants of Hyundai Motor Group.

Hyundai Steel's Beijing unit was a financial powerhouse until 2016, when China retaliated against South Korea for the deployment of the US' THAAD anti-missile system. This had a ripple effect on all of Hyundai Motor's subsidiaries, leading to a drastic decrease in sales and market share within the Chinese car market. From 2018 to 2021, Hyundai Motor's share fell from 3.59 percent to 1.21 percent while Kia's declined from 1.68 percent to just 0.43 percent in 2022. As a result, the Beijing unit experienced significant losses over this period amounting to 105.8 billion won in total.

In 2021, Dongkuk Steel Mill, South Korea's third-largest steelmaker, suffered a net loss of 49.6 billion won and had to shut down its Beijing centre while searching for potential buyers. Other Korean steelmakers operating in China experienced similar difficulties and withdrew from the region, with Dongkuk Steel China selling its 90 percent share to the Chinese government in June 2022.