The Belgium-headquartered steel cord and wire manufacturer Bekaert has announced that it has signed an agreement for the acquisition of 75 percent of the shares of the spring wire and overhead conductor business of Xinyu Iron & Steel Co. Ltd in Xinyu, Jiangxi Province, China.
The acquired activities include two production plants in Xinyu. The product portfolio includes spring wires for the automotive, motorcycle, and engineering sectors and complements Bekaert's existing product range manufactured in its wire plant in Jiangyin, Jiangsu Province. The transaction involves the transfer of 630 employees. A new manufacturing site will be built in Xinyu, where the acquired activities will be concentrated to increase manufacturing capacity and technological capabilities.
Bekaert will purchase, through its 75/25 holding with Shougang Concord Century Holdings Ltd, 75 percent of the shares of the legal entity covering the acquired activities. Xinyu Steel will retain the remaining 25 percent and the entity will be renamed Bekaert (Xinyu) Metal Products Company Ltd. The transaction, with a purchase value of RMB 161.2 million ($24.04 million), is subject to regulatory approvals and is expected to close by year-end 2010.