Major Chinese steelmaker Hebei Iron and Steel (Hebei Steel) announced on June 9 that it is planning to raise up to RMB 16.015 billion ($2.3 billion) by issuing up to 3.8 billion new Shenzhen-listed shares, in order to purchase 100 percent of shares of Hanbao Steel which is currently under the control of state-owned Hebei Steel Group.
According to a statement issued by Hebei Steel to Shanghai Securities News, its parent company Hebei Steel Group and/or its other subsidiaries will aggregately purchase at least 50 percent of the total amount of shares issued by Hebei Steel.
In 2009, Hebei Steel Group merged its three subsidiaries, including Handan Steel (of which Hanbao Steel is a subsidiary), Tangshan Steel and Chengde Xinxin Vanadium and Titanium to form Hebei Steel.
This latest move means more of the overall assets of the state-owned group will be injected into the listed company.