CORPORATE NEWS:
Mittal Steel buys into Chinese steelmaker
Mittal Steel NV, The Netherlands, has bought a 37.17% stake in Hunan Valin Steel Tube & Wire Company (HVSTW) from its parent company, Valin Group,
for US$314m.
ith an annual steel production capacity
of 8.5million tonnes, HVSTW is one of China’s largest steelmakers.
Lakshmi Mittal, chairman of Mittal Steel, commented: “Strategically this is a key acquisition. It provides us with our first production platform in the world’s fastest growing steel market. We are confident that demand for steel in China will remain strong and this acquisition is very much intended as a first step towards a more significant production presence in this country.”
For its part HVSTW welcomed the opportunity to benefit from Mittal
Steel’s assistance with technical support, procurement, sales and marketing and management expertise.
Chairman Li said: “This will have a positive impact on the Chinese steel industry in terms of its current strategic restructuring to resolve issues of lack
of scale and will lead the process
of consolidation. The cooperation in technology and sharing of global resources will be critical for the company to enter
the international steel industry.”
After completion of the transaction – which is subject to the approval of China’s regulatory authorities – Mittal Steel and Valin Group will have an equal holding of 37.17%. Mittal Steel will participate in management and be able to nominate board members.
Mittal Steel already has a presence in China in the form of sales offices in Beijing, Guangzhou, Urumuqi and Chengdu. Additionally, the company announced last year that it would invest US$100m to set up a cold rolling and coating plant in Yingkou, Liaoning Province.
Company: |
Mittal Steel NV |
Country: |
The Netherlands |
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Website: |
www.ispat.com |