WISCO, Mar. 4 -- Yesterday, the Wuhan Iron and Steel Group (WISCO) and the biggest iron and steel enterprise in Yunnan Province - Kunming Steel signed restructuring agreement, and become the new Kunming Steel's largest shareholder. This is another important strategic move of WISCO to implement the Central and Southwest development strategies and to become a super-large steel enterprise with annual capacity of 30 million mt. 

    According to the agreement, WISCO will hold 48.41% of stock with cash investment, and Kunming Steel will the second-largest shareholder with 47.41% of stock, while the original stake held by other shareholders will be adjusted accordingly.

    Kunming Steel was founded in 1939, with annual capacity of nearly 6 million mt. Kunming Steel has regional resources (rich ore, coal resources) and the regional market (near the Southeast Asia, South Asia); however, it is difficult to adapt the increasing fierce competition due to its small scale and unreasonable product structure. While WISCO has obvious advantages in capital, technology, management and scale; however, it has greater transportation costs due to its negative location. In this context, WISCO established the Central and Southwest development strategies. Over the past two years, WISCO has reconstructed Ezhou I/S and Liuzhou I/S and its annual capacity has exceeded 20 million mt. 

    After the establishment of the new Kunming Steel, WISCO will inject capital and technology to upgrade its equipment and product levels. Product mix will be extended from the current 7 categories to 14 categories, and the proportion of high value-added, high-tech products will be up to 60% in the total steel products, and significant growth will be achieved in profits.

    For more information, please refer to http://cbimetal.cbichina.com

    (Edited by CBI China)