Qinghai Province-based Chinese steelmaker Xining Special Steel Co. has announced that it has suspended its plan for a non-public offering of its shares against the background of sluggish demand in the steel markets and negative conditions in the Chinese stock market.
Xining Special Steel stated that its proposal for the non-public offering of its shares has failed to receive approval from its shareholders and that it has thus decided to halt the planned offering of shares.
Xining Special Steel had initially announced its share offer plan in July last year, aiming to issue 421 million shares at a price not less than RMB 4.82 per share ($0.79 per share), with a total value of RMB 2.93 billion ($0.48 billion). The company planned to use the proceeds to finance its technical upgrade project for its steel bar production facilities and to repay bank loans. However, in July this year Xining Special Steel reduced the anticipated share price to not less than RMB 3.97 ($0.65). On September 13, the share price of Xining Special Steel closed at RMB 4.25 ($0.69), down 2.3 percent from the close of business on the previous day.