On August 23rd, Baoshan Iron & Steel Co., Ltd. (Baosteel Co., Ltd. for short) announced its investment acknowledgement to the public. According to the acknowledgement, Baosteel Co., Ltd. planned to solely increase 12billion yuan cash capital for the construction of Zhanjiang iron and steel project of Baosteel Zhanjiang Iron & Steel Co., Ltd.. Capital increase this time would speed up taking advantages of existing strength in technology and talent resources of Baosteel Co., Ltd., contributing to the construction and advancement of Zhanjiang iron and steel project.
Major business scope of Zhanjiang Steel, currently in the phase of construction, includes ferrous metal refining, rolling and processing, sales, etc.. Its current registered capital amounts to 8 billion yuan, among which Baosteel Co., Ltd. holds 75% of its stock rights, while Guangdong Hengjian Investment Holding Co., Ltd. (herein after referred to as Guangdong Hengjian) holds 25%. On completion of capital increase this time, registered capital of Zhanjiang Steel will become 20 billion yuan (not taking into consideration of factors in asset assessment), among which Baosteel Co., Ltd. will hold 90% of stock rights, while Guangdong Hengjian holds 10%.
Till end of June 2013, unaudited total asset value of Zhanjiang Steel reached 12.466 billion yuan, net asset of 7.025 billion. Its realized operating revenue for the first half of 2013 reached 34.12 billion yuan, net profits of -13.9545 billion yuan.
As demonstrated by the acknowledgement, Zhanjiang Steel project started in May 2013, and will accomplish its construction and start commissioning in September 2016. Its static total investment reached 41.5 billion yuan. Different parts of the project will only successively enter construction peak phase since 2014. To improve capital utilization efficiency, Baosteel Co., Ltd. will adopt module of capital increase in instalments taken into consideration of company financial conditions, i.e. assessment and examination at one time, capital investment in instalments.
According to construction schedule and capital requirements in 2013 through 2015 of Zhanjiang Steel project, Baosteel Co., Ltd. planned to complete capital increase for Zhanjiang Steel within 2014. Estimated first instalment would complete in the fourth quarter of 2013 with capital increase of 6 billion yuan, and the second instalment would complete in 2014. Total capital increase would amount to 12 billion yuan.
