Baosteel buys 92.5% stake of Nantong Iron & Steel

Baoshan Iron & Steel Corp<600019>, China's largest steel maker, announced yesterday that it has bought 92.5% stakes of Nantong Iron & Steel Company (NISC) from its parent company for RMB 601 million

According to the Shanghai Security News, Baosteel Group listed its 92.5% stake of NISC in the Shanghai United Assets & Equity Exchange, and Baoshan bought the stake through a public tender. The final deal was inked at the price of RMB 601 million and has already been accomplished.

Nantong Iron & Steel, with registered capital of RMB 346 million, was built up in 1994, with Baosteel Group holding 92.5% stakes in the company. It has an annual production capacity of 1 million tons for seamless steel, while Baosteel are capable of manufacturing 1-million-ton seamless steel pipe yearly.

Baosteel is merging and reconstructing the group since 2007. It has got the approval from China Development and Reform Commission (CDRC) to build a joint venture with HanSteel, parent company of Handan Iron and Steel Co. Ltd<600001> for a 4.6-million-ton steel project, in which RMB 12 billion will be invested.

Baosteel shares surged almost 62% in the past three months to closed at RMB 17.45 yesterday.