Post by Catdaddy on Dec 11, 2007 11:19:26 GMT -5
Hmmmmmm...
Baosteel likely to inject assets into listed unit
Tue Dec 11, 2007 7:49am EST
BEIJING, Dec 11 (Reuters) - Baoshan Iron and Steel Co (600019.SS: Quote, Profile, Research) is likely to soon announce an asset injection from its parent, Baosteel Group, steel industry sources said on Tuesday.
They eased speculation that Tuesday's suspension of trading in its Shanghai-listed shares was related to an international mining merger.
The one-day trading suspension, announced by the Shanghai Stock Exchange late on Monday, had triggered speculation that Baosteel was planning an announcement related to BHP Billiton's (BHP.AX: Quote, Profile, Research)(BLT.L: Quote, Profile, Research) proposal to take over fellow miner Rio Tinto (RIO.AX: Quote, Profile, Research)(RIO.L: Quote, Profile, Research).
The listed company controls almost all Baosteel's assets in Shanghai. But new facilities, as well as purchases of steel mills in line with Beijing's consolidation drive, are usually funded by the group before being transferred to the listed company so as to keep its liabilities low and profits growing.
Baosteel Group chairman Xu Lejiang last week denied that Baosteel had the capability to make a counterbid for Rio, but rumours continue to circulate that China's sovereign wealth fund or its steel firms could trump BHP's offer.
Another possibility is that Chinese partners could provide additional cash, if BHP needs to sweeten its offer for Rio.
Any international play by Baosteel would likely come from the group, and not the listed company.
Officials from both Baoshan and Baosteel declined comment. (Reporting by Lucy Hornby, Editing by Peter Blackburn)
© Reuters2007All rights reserved
Baosteel likely to inject assets into listed unit
Tue Dec 11, 2007 7:49am EST
BEIJING, Dec 11 (Reuters) - Baoshan Iron and Steel Co (600019.SS: Quote, Profile, Research) is likely to soon announce an asset injection from its parent, Baosteel Group, steel industry sources said on Tuesday.
They eased speculation that Tuesday's suspension of trading in its Shanghai-listed shares was related to an international mining merger.
The one-day trading suspension, announced by the Shanghai Stock Exchange late on Monday, had triggered speculation that Baosteel was planning an announcement related to BHP Billiton's (BHP.AX: Quote, Profile, Research)(BLT.L: Quote, Profile, Research) proposal to take over fellow miner Rio Tinto (RIO.AX: Quote, Profile, Research)(RIO.L: Quote, Profile, Research).
The listed company controls almost all Baosteel's assets in Shanghai. But new facilities, as well as purchases of steel mills in line with Beijing's consolidation drive, are usually funded by the group before being transferred to the listed company so as to keep its liabilities low and profits growing.
Baosteel Group chairman Xu Lejiang last week denied that Baosteel had the capability to make a counterbid for Rio, but rumours continue to circulate that China's sovereign wealth fund or its steel firms could trump BHP's offer.
Another possibility is that Chinese partners could provide additional cash, if BHP needs to sweeten its offer for Rio.
Any international play by Baosteel would likely come from the group, and not the listed company.
Officials from both Baoshan and Baosteel declined comment. (Reporting by Lucy Hornby, Editing by Peter Blackburn)
© Reuters2007All rights reserved
