Mergers to continue in Chinese steel industry in 12th Five year Plan

Tuesday, 01 Mar 2011

China Securities Journal reported that Chinese steel market eyed rapid development since entering 21st century with the growth of crude steel output averaging by 21.1%YoY. The trend for the rather mystifying debacle after the Spring Festival has taken everybody by surprise.

In 2010, China has totally yielded out 630 million tonnes of crude steel. In recent years, Hebei Steel Group regrouped by Tangshan Steel and Handan Steel, realized rapid and steady developments forming a new management mode for further developments.

In the past two years, Hebei Steel Group accumulatively eliminated 5.2 million tonnes of backward steel making capacities and it also gradually regrouped 12 private owned steel mills.

Tags ; Chinese steel mills, Chinese steelmaking, mergers and acquisitions,

HBIS is second steelmaker in the world

Tuesday, 01 Mar 2011

It is reported that HBIS stood top one among national steelmakers with crude steel capacity of 44.78 million tonnes in 2010, second only to ArcelorMittal in the world.

Mr Wang Yifang president of HBIS said the secret of success was M&A. Currently, small scale of steelmakers, scattered industrial distribution and overlapping construction are serious problems for Chinese steel industry under severe control of raw material suppliers like Rio Tinto, BHP Billiton and Vale.

HBIS was a super large steel group, jointly setting up by original Taishan Steel Group and Handan Steel Group since June 30th 2008. Steel capacity of HBIS added from 31.08 million tonnes in 2007 to 44.78 million tonnes in 2010 with total assets increasing from CNY 148 billion to CNY 282.8 billion listing top 500 global enterprises for consecutive two years achieving No 314 in 2010 from No 375 in 2009.

On the basis of internal integration, HBIS took holdings of Shijiazhuagn Steel, restructuring HBXG machinery and other 12 private steel mills via progressive integration of equity. Mr Zhang Changfu vice president of CISA pointed out that integration and restructuring of HBIS left a significant demonstration effect for Chinese steel industry to implement further restructuring program. (sourced from mysteel)