China is to introduce a new policy for mergers and restructurings of domestic steel enterprises, which may accelerate restructuring actions.
According to an insider at China's Ministry of Industry and Information Technology (MIIT) the MIIT has passed a report entitled "Guidlines for Acceleration of Enterprise Mergers and Restructuring" to the Chinese State Council. The main content concerns abolition of illegitimate local policies and encouragement of enterprises to merge and restructure. If the guidelines are approved, further guidelines about merging and restructuring of non-ferrous, steel, telecommunication, petrochemical, shipping industries may also be introduced in future.
The insider states that there was little in terms of national policy for mergers and restructuring in the past. Related policies are formulated by government departments according to their responsibility and on the basis of practical operations. The Securities and Futures Commission previously published "Listed Company Major Recapitalization Management Method" and "Listed Company Acquisition Management Method." while the State Asset Regulatory Commission also published guidelines on state-owned enterprise restructuring.