ArcelorMittal to sell China JV stake to Nippon Steel

SHANGHAI (Reuters) - ArcelorMittal , the world's top steelmaker, has agreed to sell its 12 percent stake in an auto sheet joint venture with China's Baosteel and Japan's Nippon Steel to the Japanese firm, a company spokeswoman said on Friday.

The move will give Nippon Steel a 50 percent stake in the joint venture, Baosteel-NSC/Arcelor (BNA) Automotive Co, while Baosteel holds the other half.

The ArcelorMittal spokeswoman said the move is aimed at focusing on another automotive JV project with a middle-sized Chinese steelmaker, the Hunan Valin Group .

On Tuesday, the China Iron & Steel Association (CISA) criticised ArcelorMittal for not fulfilling its commitment to support Valin, saying the steel giant failed to provide the Chinese partner with the technical support needed for their joint venture auto sheet plant.

Chi Jingdong, CISA's deputy secretary general, also said ArcelorMittal did not fulfil promises to help the Chinese firm secure supplies of iron ore.

"China remains an important jurisdiction where ArcelorMittal, through its joint ventures, will continue to develop value-added steel products for the Chinese market," company spokeswoman Lynn Robbroeckx said in an email to Reuters.

Baosteel-NSC/Arcelor (BNA) Automotive Co mainly produces auto sheet for the Chinese market and has an annual production capacity of 1.7 million tonnes, with 900,000 tonnes of cold-rolled sheet and 800,000 tonnes of hot-dipped galvanized sheet.

Nanjing Steel net profits may grow by 600pct in 2010

Thursday, 03 Feb 2011

It is reported that Nanjing Iron & Steel reported a profit growth of 500% to 600% in 2010 with the nets profit which belonged to its parent company hitting at CNY 0.138 billion.
While Valin Steel disclosed a full year profit lose of CNY 2.5 billion to CNY 2.7 billion due to the bad performances of its holding company. In 2009, the company realized net profits of CNY 0.12 billion and it once predicted a full year profit lose of CNY 1.8 billion to CNY 2 billion in the third quarter of 2010.(sourced:www.cscet.com)

ArcelorMittal withdraws from the financing program of Valin Steel

Saturday, 29 Jan 2011
It is reported that Hunan Valin Steel Co Ltd finally released its non public offering plan after twists and turns. The issue price is set at 5.57 per share equal to the net asset value per share of 2009. And the number of the objects of the directional add-issuance is reduced from two to one, Hunan Valin Iron and Steel Group Co Ltd.

Early in 2008, Valin Steel had launched the directional add-issuance program, but had not gotten written approval from China Securities Regulatory Commission until last September end. The plan has been adjusted for several times and it was put off again and again owing to its stock price long moving below its slated directional add issuance price under the backdrop of government controls on steel sector and market recession.

More unfortunately, at the moment of the coming of the deadline of three months effective for the issuance, ArcelorMittal which agreed to acquire the incremental shares by cash withdrew from its earlier decision. Now, one company is left to take the bleeding deals, Valin Group.
The number of shares was once cut from 600 million set in 2008 to 550 million adjusted in June 2010 and now has again been trimmed to 278 million.

The closing price of January 26 posted at CNY 3.86 a discount of about 30.7% compared with CNY 5.57 the directional add issuance price. (sourced:21cnhr.gov.cn)