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SeAH Group remains mum over SpaceX supply deal

If deal is finalized, SeAH would become 1st S. Korean firm to secure supply contract with Elon Musk’s US space giant

By Kan Hyeong-woo

Published : Feb. 27, 2023 - 17:55

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Logos of SeAH Group and SpaceX (From SeAH Steel and SpaceX's websites) Logos of SeAH Group and SpaceX (From SeAH Steel and SpaceX's websites)

SeAH Group, a South Korean steelmaker, could become the first South Korean company to sign a delivery contract with SpaceX as the conglomerate is in talks with the US spacecraft manufacturer to supply materials for rockets and satellites, according to local reports Monday.

Citing anonymous industry sources, the reports said SeAH Changwon Integrated Special Steel (SeAH CSS) -- the group’s unit that specializes in producing special steel alloys for aerospace parts -- is carrying out negotiations with Elon Musk’s space behemoth over the contract’s size and length. The reports added the two sides are expected to close the deal before the end of this year.

The reports said the deal is expected to last over a period of between three to five years. The supply materials will include steel alloyed with metals such as nickel, chrome and titanium, which are expected to be used for SpaceX’s rockets and satellite engines.

According to SkyBrokers, SpaceX is known to have over 3,000 suppliers with about 1,100 of them delivering parts and materials to the space giant on a weekly basis.

SeAH CSS is a 100 percent subsidiary of SeAH Besteel Holdings, the group’s intermediate holding company. SeAH CSS has supplied its specialty alloy products to defense and aerospace industries. The steelmaker signed a memorandum of understanding with Korea Aerospace Industries, the nation's sole aircraft maker, in June last year to develop alloy steels using aluminum and titanium for aircraft parts.

Neither SeAH Group nor SpaceX could be reached for official comment on the reported supply discussions.

According to SkyBrokers, SpaceX is known to have over 3,000 suppliers with about 1,100 of them delivering parts and materials to the space giant on a weekly basis.

“I didn’t know about it,” an official at SeAH CCS said without further explanation when asked about the reports.

The stock prices of SeAH Besteel Holdings and SeAH Special Steel soared on the back of the reports, both jumping over 29 percent shortly after the market opened Monday morning. SeAH Besteel Holdings closed at 23,850 won ($18.08) per share and SeAH Special Steel finished the day at 20,150 won per share, up 29.83 percent and 17.77 percent, respectively, from Friday’s closing.

SeAH Group logged 8.8 trillion won in sales and 607.2 billion won in operating profits last year, according to the group. The enterprise value of SpaceX, a private company, was estimated at $140 billion as of December last year, according to market analyzer FactSet.