Officials in LG Group and LG Metals declined to comment.

"Sakamoto and other Japanese metal industry officials will leave for Seoul this Sunday to visit LG Metals' smelting and refining plants in Onsan and Changhang early next week," a senior executive in the local metal industry said.

Sakamoto was also expected to meet Kang Yu-sik, president of the LG Executive Office for Corporate Restructuring, and Chung Chung-won, president of LG Metals, the source said.

The source said the other Japanese industry officials include senior officials from Marubeni Corp and Mitsui Mining and Smelting Co Ltd.

LG Metals and a Japanese consortium led by Nippon Miningare expected to sign a memorandum of understanding in February after Sakamoto's visit to Seoul with one month due diligence, the sourcesaid.

An official announcement from LG Group on the result of the negotiations was expected to be made after an LG Metals' shareholders meeting set on February 20, the source said.

Sakamoto told Reuters in an interview on Monday that the biggest Japanese copper producer hoped to tie up with the only copper producer in South Korea.

"It would bring big advantages for both of us, you need to have a certain share in the market if you want to have price or premium setting power," Sakamoto said in Tokyo.

Nippon Mining had proposed LG Metals hive off its Onsan and Changhang copper plants and the two firms then join up as equal partners, Sakamoto said.

Trade sources in Seoul said Nippon Mining was expected to arrange financing for the new joint venture from the Export Import Bank of Japan and other foreign banks to take over LG Metals' plants Onsan and Changhang.

In December, LG Industrial Systems Co Ltd, which makes elevator and electric power equipment, said it would merge with LG Metals by May 1following the LG Group's promise with the South Korean government for its restructuring programmes.

The two companies are subsidiaries of the LG Group.

Meanwhile, LG Metals still has to get over several hurdles before the company reaches a final agreement with the Japanese partner, trade sources said.

One was a proposed free trade agreement between the South Korean government and the Chilean government, the source said.

If the free trade agreement was made, Chilean copper cathode would flood into the South Korean market as there would be no import tariff on the Chilean metal, he said.

South Korea currently has a five per cent import tariff on copper cathode imports.