Baosteel and Masteel ink strategic coalition agreement

Baosteel and Masteel ink strategic coalition agreement

SteelOrbis Shanghai Baosteel and Masteel inked a strategic cooperation agreement in Shanghai on January 18, 2006. The companies decided to cooperate on research and development and to act together in bulky raw material purchases and in marketing. Both parties will hold periodical top official visits and a work group will be arranged to carry out the cooperation projects. Baosteel is the largest and the most modern iron and steel company in China, mainly deals with high grade sheet products. Masteel is one of the major iron and steel companies in East China, mainly deals with CR and HR sheet/coil, H beam, high speed wire rod and rim for automobile wheel. Following the merger of Angang and Benxi Steel and the restructuring of Tangshan Steel and Handan Steel, the merger of Wuhan Steel, Egang and Guangxi-based Liuzhou Steel, this agreement is another major step in consolidating the highly dispersed Chinese steel industry. However, market players think that there's a long way to before the actual Baosteel and Masteel merger because Baosteel belongs to the State-owned Assets Supervision and Administration Commission of the State Council, while Masteel belongs to the Anhui Province.