China's Government

in Steel

While planning the revitalization of the steel and automobile are many support the acquisition of listed companies list, but the industry generally believe that markets need government-led mergers and acquisitions with an estimated face difficulties in operating the field of industry, such as steel, nonferrous metals and other vulnerable first, The effect of this merger are still doubts.



Hardware Network HC * To encourage mergers and acquisitions are an important part of Top Ten Industry Promotion Planning



* Difficult or easy to advance the field, such as Steel Non-ferrous metals



* Government-led mergers and acquisitions, the actual effect of doubtful



Reuters Beijing / Shanghai on May 19 Xinhua --- "encourage mergers and acquisitions" is undoubtedly China's top ten industrial revitalization plan in the most popular terms are also apparent from an important industry in China to build aircraft carrier's determination.



"Generally, the higher degree of industrial concentration, promoting the acquisition of state-owned large enterprises the government easier, anyway, are state-owned enterprises, the boss is one; and management faced a difficult and loose market-driven industry need," National Development and Reform Commission Enterprise Reform and Development Institute of Economic Research Office, Liu Quan-hong said.



He also believes that the current view of the revitalization of China's top ten iron and steel industry, Car The areas of mergers and acquisitions may be faster.



The end, the Chinese government put expanding domestic demand and promote economic growth, ten measures, and subsequently introduced the steel, automobile, shipbuilding, petrochemical, Textile , Light industry, non-ferrous metals, equipment manufacturing, Electronic Revitalization planning information and other key industries, to encourage M & A is one of the important content.



** "First married Ugly" ** There is no doubt face difficult survival, loss-maker, excess industry capacity has the easiest to achieve acquisition.

Thus revitalizing industry in the top ten iron and steel is the industry agreed that the easiest and most likely target of government acquisition, followed by colored metal and automobiles; As in other areas, to achieve the goal of the revitalization plans would not be easy.



Nadu Securities steel industry analyst Tao Zhi-feng said, "For all businesses, mergers and acquisitions should now be a good time to present new capacity is inappropriate, to expand only on the lower or horizontal integration."



Specific to the steel industry, he believes that in addition to those fundamental restructuring of the dust has settled, the annual production capacity of around several hundred tons of steel could be merged second-line goals, such as Nanchang steel. But the attitude of local government is local very critical, if the local government support, some of the restructuring process would be relatively smooth.



"Most of the domestic steel edge at the break, if this situation would continue for another six months, or the economy a little easier, a number of industry mergers and acquisitions more likely." He said.



One of China's largest steel mills - Baoshan Iron & Steel (600019.SS: Quote) parent company Baosteel Group Chairman Xu Lejiang last Saturday had said that the domestic steel industry this year is expected to be at a loss; Baosteel will be more joint restructuring to enhance competitiveness.



Tangganggufen (000709.SZ: Quote), a person on condition of anonymity, said Hebei's steel business integration as early as last year, led by the local government, the current form of Hebei, Hebei Iron and Steel Group is part of the territory and the surrounding steel companies and mines, all the integrated iron and steel import and export trade. The combined output of Hebei Iron and Steel Company, whether the forefront of the industry or the size of both columns.



Program under the merger, Hebei Iron and Steel Group subsidiary Tangganggufen, Handan Iron & Steel (600001.SS: Quote), Chengde (600357.SS: Quote) will triple, to be absorbed by the merger of issued shares of Handan Tangganggufen Steel and Chengde two listed companies and then to achieve the primary iron and steel industry as a whole listed group.



Steel industry revitalization plan has been clear that the saddle forward and Panzhihua, Northeast Special Steel, Baosteel and Baotou Steel, Ningbo and other regional restructuring of the steel; promote Tianjin Iron Steel and Tin, Tin Steel, Tianjin Metallurgy Companies, such as iron and steel enterprises in the province of TISCO and restructuring within the region.



** "Called worry about" ** The auto industry mergers and acquisitions has also been concern, especially when the world's major auto makers are facing bankruptcy or mergers of fate, no doubt to the Chinese automotive manufacturers the chance opportunity to expand their territory.



Liu Quan-hong that the auto industry a high degree of industry concentration, especially in industrial planning in clear reference to the list of supporting companies, such state-led

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This article was published on 2010/10/14