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BIZCHINA / Center
Baosteel nods to Hebei venture
By Jin Jing (China Daily)
Updated: 2007-09-07 09:00
Baosteel Co Ltd yesterday said it approved a proposal by its parent
company Baosteel Group to set up a joint venture with Handan Iron & Steel
Group to invest in a steel project in Hebei Province that is expected to
have an annual steel output of 4.6 million tons.
Baosteel Co also said it reserved the right to buy its parent company's
stake in the joint venture, according to the company's statement to the
Shanghai Stock Exchange. Baosteel shares jumped 2.35 percent to close at
19.57 yuan yesterday.
The 50-50 joint venture, with registered capital of 12 billion yuan, was
proposed in May.
The Hebei steel project was started in February last year, with a total
outlay of 19.4 billion yuan. The first phase is expected to be completed
in 2008 and the second phase by 2010.
"Baosteel Co will consider whether to invest in the project after it
begins production," Chen Ying, board secretary of Baosteel Co, told China
Daily yesterday.
Liu Yanqi, an analyst at Haitong Securities, said: "Baosteel has enough
capital and technology to develop the project but market risks, including
changes in fixed-assets investment and other macroeconomic policies may
have a negative impact on the project."
(For more biz stories, please visit Industry Updates)
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