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CITIC consolidates special steel business

Daye Special Steel Co., Ltd., which is 58.13% indirectly owned by Citic Ltd., has entered into an agreement with six parties to acquire an 86.5% stake in Jiangyin Xingcheng Special Steel Works Co. Ltd. for 23.18 billion Chinese yuan, according to a CITIC statement dated Jan. 2.

Under the agreement, Daye Special Steel will issue 2,318,199,998 new shares at 10 yuan apiece.

CITIC presently indirectly holds a 90% in Xingcheng Special Steel. Xingcheng Special Steel's assets comprise four special steel plants, a pellet plant, and a coking coal plant.

After the transaction, CITIC's holding in the enlarged Daye Special Steel will be increased to 83.52%.

CITIC said the transaction is expected to unlock the true value of its special steel business, further streamline its special steel business and bring greater synergies.

As of January 2, US$1 was equivalent to 6.86 Chinese yuan.