WISCO purchases assets of Egang by allotment

Sep.24 MetalBiz--The general shareholders meeting passed the proposal that WISCO collected 12bln yuan at most by allotment to purchase the relevant steel industry's assets. After acquisition, WISCO will expand steel capacity, improve the plate products' structure and form an integrated enterprise of production, sales, and research.

According to the plan of WISCO, it will spent 6.289bln yuan to buy 77.6% shares of WUHAN IRON&STEEL GROUP ECHENG IRON AND STEEL CO., LTD (Egang), 100% stakes of Powder Metallurgy Co., Ltd. Of Wuhan Iron&Steel Corp, the assets of metallurgical slag utilization and loans. The 1.216bln yuan will be put in pellet production facilities in Echeng Xinmiao Industrial Park and the remaining funds will be used to supplement the flow cash of the company.  

After recombined by WISCO in 2005, Egang became the steel mill of the latter. Following, Egang which takes the long products as a core set up a CR plate and galvanized plate project with 600,000 tons of capacity, and the profit that year increased from last year' s 20mln yuan to 100mln yuan. At present, Egang entered the field of high-end plate and will form the width-plate production capacity with 1.6mln tons.

The data from WISCO show that Egang profited 154mln yuan in H1 this year. The sources from Egang official website also indicate that the company's sales revenue was 823mln yuan in August and the profit was expected to reach 80mln yuan.