The China Securities Regulatory Commission (CSRC) yesterday approved the merger of Tangshan Iron & Steel Co with Handan Iron & Steel and Chengde Xinxin Vanadium & Titanium Co, paving the way for Hebei Iron and Steel Group (Hebei Steel), their parent, to become the country's second largest steelmaker.
The merged entity will have an aggregate market value of about $4 billion.
T he three arms, Handan Iron & Steel Ltd, Tangshan Iron & Steel Co, and Chengde Xinxin Vanadium & Titanium Co, all announced that their shares have been suspended from trading starting Sept 17 and that it would resume only after the regulatory review result is publicized.
As early as December 2008, Hebei Steel unveiled its overall listing scheme, under which Tangshan Iron & Steel would become its only listed arm engaged in the pillar iron and steel business, after absorbing the other two listed arms through a share swap.
After the consolidation, the crude steel production of Tangshan Iron & Steel would touch 21.2 million tons, up 86.4 percent from the current 11.4 million tons, while Hebei Steel will have a total capacity of 330 million tons annually, ranking second in China and the fourth in the world.
Hebei Steel also said it would inject the assets of Xuansteel and Wuyang Steel into the listed Tangshan Iron & Steel one year after the three arms' consolidation.
