Beijing Jianlong Group announced that it plans to invest RMB 1.26 billion ($0.18 billion) in acquiring Qinghai Province-based Chinese special steel producer Xining Special Steel Co., Ltd. via its controlling subsidiary Tianjin Jianlong Iron and Steel Co., Ltd. Accordingly, Jianlong Group will hold 29.95 percent of total share capital in Xining Special Steel.
Xining Special Steel is mainly engaged in the smelting, rolling and processing of special steel, with a comprehensive production capacity of 750,000 mt of coke, 2.1 million mt of crude steel and 2.0 million mt of finished steel.
In 2019 and 2020, Xining Special Steel posted net profits of RMB 96 million and RMB 95 million, while registering net losses of RMB 1.147 billion and RMB 1.151 billion in 2021 and 2022, respectively. In the first nine months this year, Xining Special Steel posted a net loss of RMB 1.166 billion.
Following the acquisition, Jianlong Group will inject its high-quality special steel assets into Xining Special Steel at the right time. By the end of 2028, Xining Special Steel is anticipated to have an annual crude steel production capacity of 10.59 million mt and to achieve a net profit of RMB 4.271 billion.
Currently, Jianlong Group has 44.3 million mt of mining and beneficiation capacity and 42 million mt of crude steel smelting capacity. In 2022, Jianlong Group produced 36.56 million mt of crude steel.