SteelOrbis Shanghai
Mittal Steel was reported to be interested in acquiring some stake in Bayi Steel. However, this Xinjiang province based steelmaker signed a strategic partnership agreement with Shanghai based
Baosteel on March 11 in Beijng which prevents Mittal's stake takeover from Bayi Steel.
Being strategic partners,
Baosteel and Bayi Steel will cooperate in expanding their market shares, developing resources and renewing technology.
In
China, the government plays an important part in promoting the acquisition and cooperation of large scale state-owned enterprises. Bayi Steel's equipments and technology are outdated. Therefore
Baosteel is more likely to give assistance for the development in Xinjiang Uyghur Autonomous Region.
Bayi Steel has a monopolistic position in terms of its favourable geographical condition.