Shougang expected to withdraw from the first overseas steel project

With the transformation of Shougang to urban integrated service providers, the layout of existing steel mills is facing adjustment. In December 17th, the Beijing News reporter learned from the Beijing property exchange that Shougang sold the related creditor’s rights claim of Malaysia Donggang group, indicating that Shougang is about to quit its first overseas steel project.
According to the information listed in the North exchange, Dongfang iron and Steel Investment Co., Ltd. sold 40% shares and 834 million 290 thousand yuan claims for East Steel Group Co., Ltd. for 860 million yuan. The 40% share price of this subject is 30 million 466 thousand yuan, and the price of the creditor’s right is 834 million 290 thousand yuan, of which the principal is 681 million 339 thousand and 800 yuan and the interest is 152 million 952 thousand and 590 yuan.
The first block of the first phase of the first phase of the Malaysia East steel company, Shougang, was made out of the furnace. The project involves the whole process of oxygen making, sintering, iron making, steelmaking and rolling, and the annual output is 700 thousand tons. The annual output is 1 million 500 thousand tons after the first phase of the project is completed. After the completion of the project, the planned annual capacity can reach 3 million tons.
Shougang, one of the top steel giants of China and one of the largest state-owned enterprises in Beijing, has begun to implement a large business transformation since the completion of the relocation.
First Dachang ore is mainly responsible for the iron ore project in Huoqiu. According to the Beijing News reported on November 27th, due to the project itself and the private shareholders of Anhui Dachang Mining Group Co. Ltd. involved with Ni Fake as the head of Anhui Woan officialdom, first Dachang ore project continued to shut down. North exchange project listing information shows that since 2016, the first Dachang ore did not produce income, operating income and net profit is zero. At the end of June 2017, total assets of 4 billion 690 million yuan, total liabilities 1 billion 775 million yuan, equity 2 billion 918 million yuan.
The financial data showed that the business income of Donggang group was zero in 2016 and the net profit was 236 million 540 thousand yuan.
East steel group management is expected in February 1, 2018 will resume production, the total output in 2018 is expected to be 578 thousand and 800 tons, and after 2018 the annual output will remain at 665 thousand tons.

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Post time: Dec-28-2017
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