Liaoning Province-based Chinese steelmaker Angang Steel Co. (Ansteel) has announced that it has inked a debt-for-equity swap agreement with China Industrial Bank Co., Ltd (CIB).
According to the agreement, CIB will provide RMB 10 billion for Ansteel to reduce its debt and in exchange CIB will become a shareholder in Ansteel.
In August 2016, the China Banking Regulatory Commission (CBRC) has stated that bank debts of Chinese steel and coal enterprises which are struggling to repay them may be converted into equity in the enterprises. The debt-for-equity swaps would reduce the debt burden on the coal and steel businesses and ease the financing difficulties experienced by the coal and steel industries and allow them to embrace better development opportunities.