Baowu Iron And Steel Became The Actual Controller Of Chongqing Iron And Steel Company

After nine months, China Baowu finally took Chongqing Iron and steel into its pocket.

On the evening of September 16, Chongqing Iron and steel (601005. SH) announced that China Baowu iron and Steel Group Co., Ltd. (hereinafter referred to as "China Baowu") and Chongqing strategic emerging industry equity investment fund partnership (hereinafter referred to as "Chongqing Zhanxin fund") signed a "consistent action agreement" to replace the original siyuanhe Equity Investment Management Co., Ltd. (hereinafter referred to as "Siyuan") He became the actual controller of Chongqing Iron and steel.

"For Chongqing Iron and steel, after the bankruptcy reorganization, China Baowu's intervention will enable it to obtain the support of large platform in technology, management and future development, which is good for Chongqing Iron and steel." On September 17, Xu Xiangchun, the chief information officer of iron and steel.com, said in an interview with the 21st century economic reporter that Baowu of China needs to continue to play a leading role in accelerating the integration of China's steel industry. At present, its production capacity has exceeded 100 million tons and has not reached its target. In its development strategy, it will certainly further expand its scale.

Join hands with Chongqing Zhanxin fund

In fact, after the judicial restructuring, Chongqing Iron and steel is in a steady rise period.

In April 2017, the first intermediate people's Court of Chongqing announced the application for Chongqing Iron and steel restructuring, which opened the prelude to the judicial restructuring of Chongqing Iron and steel. At that time, Chongqing Iron and Steel Co., Ltd. had been in huge losses in successive years, and had been charged with a hundred lawsuits under heavy debts. If it still failed to make profits within the year, it would face the risk of delisting.

Under the guidance of multi-party coordination, Siyuan fund, as the first domestic steel industry structural adjustment fund, was introduced to participate in restructuring in a market-oriented way. On November 20, 2017, Chongqing No.1 Intermediate People's court approved Chongqing Iron and Steel's restructuring plan, and confirmed on December 29 of that year that the implementation of the reorganization plan was completed, avoiding delisting risk.

In the tide of de capacity, the merger and reorganization of the steel industry is still accelerating. In this case, the historical mission of Siyuan mutual fund has been completed. With the successful change of the actual controller, it will completely withdraw from the historical stage.

Before this change, Chongqing Changshou iron and Steel Co., Ltd. (hereinafter referred to as "Changshou iron and steel") is the controlling shareholder of Chongqing Iron and Steel Co., Ltd., holding 2.097 billion shares, accounting for 23.51% of the total share capital of the company. As the executive partner of siyuanhe Industrial Development Fund, siyuanhe investment is the actual controller of Chongqing Iron and steel.

According to the transaction plan, siyuanhe investment transferred the partnership interest of siyuanhe Industrial Development Fund to Desheng group, at the same time, siyuanhe Industrial Development Fund was dissolved, and 75% equity of Changshou iron and steel was distributed to China Baowu and Desheng group according to the proportion of paid in capital. China Baowu obtained 40% equity of Changshou iron and steel and reached an agreement with Chongqing Zhanxin fund to achieve long-term benefits As a result, Shougang indirectly controlled 2.097 billion shares of the company, accounting for 23.51% of the total share capital of the company.

According to the agreement on concerted action, Chongqing Zhanxin fund, as the shareholder of Changshou iron and Steel Co., Ltd., keeps consistent action with China Baowu, and exercises the shareholder rights of Zhanxin fund in Changshou iron and steel in accordance with the opinions of China Baowu, so as to ensure that China Baowu obtains actual control over Changshou iron and steel and Chongqing Iron and Steel Co., Ltd., Chongqing Yufu capital urges Zhanxin fund to cooperate with China in accordance with the agreement on concerted action Baowu is acting in concert.

Under this arrangement, the main executives of Chongqing Iron and Steel Co., Ltd. have been re elected, and Baowu group has actually settled in the daily management of the company. In July this year, Zhang Jingang, who previously served as deputy general manager of Baowu group and member of the Standing Committee of the Party committee, was officially elected as the new chairman of Chongqing Iron and Steel Co., Ltd.

At that time, Zhang Jingang publicly said: "although there have been many unexpected shocks this year, we believe that difficulties are always temporary, and the future is still very good."

Du Hui, a researcher at Zhongtai securities, said in his research report: "relying on Baowu group, Chongqing Iron and Steel Group will form a multi-faceted collaborative support. In the first half of the year, Baosteel finance company has increased loans of 500 million yuan. At the same time, the company plans to jointly invest with Baowu group, Baoshan Iron and steel, Maanshan Iron and Steel Group, Masteel group, Echeng Iron and steel group of Wuhan Iron and Steel Group and Guangdong Shaogang to establish Baowu raw material procurement services Limited company, in the raw material procurement bargaining advantage, for the company, iron ore quantity, quality and resources are guaranteed

Speed up integration

As a leading steel enterprise in Sichuan and Chongqing region, Chongqing Iron and Steel Co., Ltd. has achieved success step by step in accordance with the production and operation policy of "increasing scale, adjusting structure and reducing cost" and the working keynote of "comprehensively benchmarking and finding difference, paying close attention to reducing cost and increasing efficiency, extreme management and consumption limit".

According to the semi annual report disclosed by Chongqing Iron and steel on the evening of August 25, in the first half of the year, the company realized 10.927 billion yuan of operating revenue, 121 million yuan of net profit belonging to shareholders of listed companies, and the basic earnings per share was 0.01 yuan. In 2019, the company achieved 6.1103 million tons of iron, 6.7236 million tons of steel and 6.4274 million tons of steel, respectively, with a year-on-year growth of 7.62%, 5.36% and 5.18%, respectively, which exceeded the annual plan and set the best level in history. The company achieved 6.574 million tons of steel sales, with a year-on-year growth of 7.62%, and the operating revenue of 23.478 billion yuan, a year-on-year increase of 3.70%.

According to the plan of Chongqing Iron and Steel Co., Ltd., the company will still adhere to the market positioning of "based on Chongqing, deeply plough Sichuan and Chongqing, and radiate Southwest China", implement the production and operation policy of "full production and full sales, low cost and high efficiency", and improve the direct supply, direct sales and direct distribution sales system. At present, the company's cost level has ranked the leading level in Southwest China.

Chongqing Iron and Steel Co., Ltd. is the treasure of China. After acquiring WISCO, Masteel and Chongqing Iron and Steel Co., and including Taiyuan Iron and steel, which is still waiting for approval, Baowu of China has become the global steel overlord, and will actually control nine A-share listed companies: Baosteel, Baosteel packaging, Baosteel software, Songshan, Bayi Iron and steel, TISCO stainless steel, Masteel, Chongqing Iron and steel and Ruitai technology.

In this regard, Xu Xiangchun pointed out: "for the industry, the low concentration of the iron and steel industry will lead to excessive competition and insufficient efficiency. The policy has always been inclined to accelerate industry integration. It is hoped that the top ten enterprises will account for 60% of the total. This year, it will be about 30%. Therefore, merger and reorganization will continue. At present, all of them are the integration of state-owned steel mills. Whether the future merger and reorganization will gradually expand to private enterprises remains to be seen. "

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