Hubei Province-based Chinese steelmaker Hubei Xinyegang Steel Co., Ltd., a subsidiary of CITIC Group, plans to increase its capital to RMB 13.58 billion ($2.0 billion) in Nanjing Iron and Steel Group (Nangang Group), as a result of which it will hold 55.25 percent equity and become the controlling shareholder in Nangang Group, as announced by Nanjing Iron and Steel Co., Ltd (Nanjing Steel). At the same time, Nangang Group has decided to exercise the right of first refusal and purchase 60 percent equity in Nanjing Iron and Steel United Co., Ltd. (NISCO) from the shareholders of FOSUN, the China-based global home consumption industry group.
After the transaction, Nangang Group will hold 100 percent equity in NISCO and become the indirect controlling shareholder of Nanjing Iron and Steel Co., Ltd. (Nanjing Steel), while CITIC Group will become the actual controller of Nanjing Steel.
On April 2, FOSUN also announced that it has inked an agreement with Nangang Group, selling 60 percent equity in NISCO to the latter party.