BEIJING: China’s Shandong Iron and Steel Co Ltd said on Wednesday that its ownership may change as a result of a planned reorganization of its parent company, China Baowu Steel Group, which is the world’s largest steelmaker. The state assets regulator of eastern China’s Shandong province was working with Baowu on a “strategic restructuring” of parent business Shandong Iron and Steel Group, according to a filing to the Shanghai Stock Exchange. “This situation could result in a change in the company’s controlling shareholder and actual controller,” it stated, noting that there were still some unknowns.
The announcement elicited no instant response from Baowu.
Shandong Iron and Steel Group, China’s seventh-largest steelmaker by production with 31.11 million tonnes in 2020, would be merged into Baowu, according to Chinese media 21st Century Business Herald.
After churning out a world-beating 115 million tonnes last year, acquiring the Shandong manufacturer would push Baowu’s annual steel production above the 150 million tonne threshold.
Baowu’s acquisition spree accelerated in 2020 when it acquired Taiyang Iron and Steel (Tisco), China’s second-largest stainless steel producer, as the country aims to consolidate 60-70 percent of production in the hands of the top 10 steelmakers by 2025.
(Min Zhang and Tom Daly contributed reporting, while Louise Heavens and Kirsten Donovan edited the piece.)/n
