XIAMEN FIT IMPORT & EXPORT CO., LTD.

Shougang plans to inject plant into listed unit
click rate:2826 issue time:2007-03-10 08:12

Mar. 9, 2007 (China Knowledge) – Steelmaker Shougang Group, which aims to have all its assets listed, plans to eventually transfer the ownership of a new plant in exchange for more stakes in its domestically listed unit Beijing Shougang <000959>.

Shougang Group would sell the plant to Shenzhen-listed Beijing Shougang by 2010 in exchange for shares in the unit, group chairman Zhu Jimin said. The plant, in which Shougang Group has a 51% stake, is located in Caofeidian, Hebei province. Its partner in the venture is Tangshan Iron and Steel.

The plant is currently undergoing construction, which is expected to complete by 2010. The plant will be capable of producing 9.7 million tons of steel products, compared with the group's targeted total output of just over 14 million tons this year.

Beijing Shougang produced 2.56 million tons of crude steel and 2.3 million tons of steel products in the first half of last year.

The company, which focuses on construction steel, reported a 39.8% fall in net profit to RMB 447.83 million for the first nine months last year from a year earlier, as prices fell sharply due to industry overcapacity. Turnover edged up 2.67% to RMB 16.51 billion.