Chongqing Iron and Steel signed a major asset restructuring framework agreement

Being re-suspension of Chongqing Iron and Steel came the news, the company August 31 with the largest shareholder of Chongqing Iron & Steel Group and Chongqing Yufu Holding Group Co., Ltd. signed a "major asset restructuring framework agreement", the parties reached a preliminary intention, made clear this transaction will include the sale of assets, asset acquisition and matching funds raised in three parts.
According to the announcement, the three parts of this major asset restructuring are as follows: First, the sale of assets, Chongqing Iron and Steel intends to sell some assets of the company and the current steel production and management related assets held; Second, asset acquisition, the proposed acquisition of assets quality assets relates to the field of finance, industrial investment through the integration of Yufu after holding the control of Chongqing Yufu assets management Group held; three supporting fund-raising, the transaction may involve the company's non-public offering to raise support.
Framework agreement also made it clear that this counterparty including heavy steel group, Yufu Holding and possibly other potential counterparties. Results evaluation value after the transaction pricing, places will be evaluated by the agency qualification of securities issued by the asset appraisal report identified as the basis of price, and unanimously determined through consultation of all parties. After the signing of the framework agreement, the parties should continue to be positive on the specific content of the trading scheme, the sale of a specific range / acquisition of assets, transactions, transaction price, the shares of the issue price of shares issued number of matters such as communication, argumentation, negotiation, and agreed upon the signing of the final major asset restructuring agreement.
Chongqing Iron & Steel August 30 evening announced the 2016 semi-annual report, although January-June domestic steel market has been warmer, but overall still in the doldrums, the company achieved operating income of 2.789 billion yuan, down 38.09%; attributable to shareholders net profit -17.90 billion yuan, up 19.63% reduced losses.
The company believes that with the recent downward pressure on the domestic economy and the slow increase of the global economic recovery, the steel industry serious excess capacity, steel prices hit record lows; at the same time, the social cost of human resources gradually rise, leading to a further decline in gross profit margin of steel products, the domestic steel industry have faced enormous pressure on the operation. By continued deterioration in the steel market, the company has significantly declining revenues, profitability of listed companies is deteriorating. To improve the performance of listed companies from the fundamental to protect the interests of small investors, the company intends to existing steel business and related assets set out, at the same time into strong profitability of high-quality assets.
It is understood that this year from June 3, Chongqing Iron & Steel has organized some brokers, lawyers, accountants and other intermediaries are entering the underlying assets and listed companies to assist the demonstration of this transaction program, and actively promote the comb with the previous underlying asset due diligence . Meanwhile, the financial advisor to assist the Company launched a preliminary dialogue and negotiation between creditors and financial management of creditors, a preliminary understanding of the creditors listed companies as a whole set out the views and aspirations of assets and liabilities, and to develop a work plan for follow-up based on feedback from creditors. To be the underlying asset scope clear, the company will officially hired financial advisers and other intermediaries and counterparties of preliminary due diligence information in-depth study and further completion of due diligence, combined with due diligence and carding results and creditors communication situation, this restructuring plan ongoing communication and demonstration.
According to the latest progress, Chongqing Iron & Steel is expected to be held on Nov. 2 Board of Directors considered a major asset restructuring plan and announcement.



Contact: Baosen Steel

Phone: +86-532-88890950

Tel: +86-532-88890950


Add: No. 61 Haier Road Qingdao China1

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