China: Baowu Steel to Buy Controlling Stake in Chongqing Iron and Steel

China's leading Baowu Steel Group has stepped closer to its target of expanding its production output to 100 MnT. The company has expressed interest to acquire a controlling stake in Chongqing Iron and Steel Co. Ltd. Chongqing Iron and Steel Co Ltd has steel making capacity of around 8 MnT pa.

The latter has announced on 28 Dec'19 that it's actual controller - Four Rivers Investment Co. Ltd has signed a letter of intention with China Baowu Steel Group, according to which China Baowu would take the controlling stake in Chongqing Iron and Steel Co. Ltd.

"Taking a controlling stake in Chongqing Iron and Steel is one of the latest acquisitions and consolidations China Baowu has made in the past few years since it unveiled the target of expanding its capacity to 100 MnT by 2021," said Wang Guoqing, director of the Lange Steel Information Center.

China Baowu Steel Group is world's second largest steel producer after Arcelor Mittal with a production capacity of 90 MnT pa.

On 2 Jun'19, Baowu Steel already announced its decision to acquire to buy a majority stake in smaller domestic rival Magang Steel.

According to World Steel Association, Baowu Group produced 67.43 MnT steel in CY18.