Baoshan Iron & Steel Co., Ltd.

Baoshan Iron & Steel Co., Ltd., also known as Baoshan Iron & Steel and Baosteel, is a maker of steel based in Shanghai, China, and a subsidiary of state-owned China Baowu Steel Group (formerly Baosteel Group). It is listed on the Shanghai Stock Exchange.

For the parent company of this company, that formerly known as Baosteel Group (Baoshan Iron & Steel Group), see China Baowu Steel Group.
Baoshan Iron & Steel Co., Ltd.
Baosteel
Typepublic
SSE: 600019
ISINCNE0000015R4
IndustryMetallurgy
Founded3 February 2000 (2000-02-03)[1]
FounderBaosteel Group
Headquarters
Shanghai
,
China
ProductsSteel
Revenue CN¥292 billion (2019)
CN¥012 billion (2019)
Total assets CN¥340 billion (2019)
Total equity CN¥178 billion (2019)
Owner
Baowu(61.93% directly and indirectly)
Number of employees
52,323[2]:83 (2019)
Subsidiaries
Wuhan Iron and Steel Co. Ltd.(100%)
Meishan Iron & Steel Co., Ltd.(77.0%)
Zhanjiang Iron & Steel Co., Ltd.(90.0%)
Baosight Software(50.8%)
Chinese name
Simplified Chinese宝山钢铁股份有限公司
Traditional Chinese寶山鋼鐵股份有限公司
Literal meaningBaoshan Steel and Iron Company Limited by Shares
stock alias
Simplified Chinese宝钢股份
Traditional Chinese寶鋼股份
Literal meaningBaosteel Shares
short name (shared with parent company)
Simplified Chinese宝山钢铁
Traditional Chinese寶山鋼鐵
Literal meaningBaoshan Steel and Iron
second short name (shared with parent company)
Simplified Chinese宝钢
Traditional Chinese寶鋼
Literal meaningBaosteel
Footnotes / references
in consolidated financial statements; excluding minority interest from equity and profit figures[2]:93–98

History
See also: Baowu § History

In 2000, the Baosteel Group split, creating the new Baoshan Iron & Steel Co., Ltd.,[1] which is listed on the Shanghai Stock Exchange since 12 December 2000.[3] It was the largest initial public offering in Mainland China up to that time,[4][5] raising CNY 7.7 billion despite being limited to domestic investors.[6][7] It was rumoured that the company has planned to list in the Stock Exchange of Hong Kong in the same year.[8] (and again in 2007) However, they were never materialized. Baoshan Iron & Steel's IPO record was broken by fellow government controlling listed company Sinopec in 2001.[9][10] Nevertheless, Baoshan Iron & Steel also re-capitalize a few times to increase its share capital and market capitalization. For example, right after the IPO the share capital was CNY 12,512 million,[1] as of 31 December 2019, it was CNY 22,274,460,375.[2]

The major assets of the listed company at that time was the steel plant located in Shanghai.[1]

However, even until today, not all of the assets of China Baowu Steel Group were injected into the listed company, for example steel plants that incorporated as Maanshan Iron & Steel Shaoguan Iron and Steel and Xinjiang Ba Yi Iron and Steel. Some of the assets were injected into another listed company Baosight Software in 2001. In 2004 Baoshan Iron & Steel Co., Ltd. acquired Baosight Software from the parent company.[11][12] In the same year the listed company also attempted to acquire other assets from the parent, such as Meishan Iron & Steel, as well as the "special steel" (Chinese: 特殊鋼) production line of Shanghai Fifth Steel Plant.[11][13] At that time, another unlisted sister company which has major connected transactions with the listed company, was Shanghai Baosteel International Economic & Trade Co. Ltd. (Chinese: 上海宝钢国际经济贸易有限公司; "Baosteel International" (Chinese: 宝钢国际) in short).[12] Baosteel International became a wholly owned subsidiary of the listed company in 2005.[14] A redistribution of the businesses of Baosteel International, to sister division and company was took place in 2006.[15]

In 2016, Baoshan Iron & Steel Co., Ltd. merged with Wuhan Iron and Steel Company Limited in an all-share deal.

Subsidiaries

Baoshan Iron & Steel owned 4 major steel plants that located in Shanghai, Nanjing (in Meishan Iron Mine), Zhanjiang and Wuhan. The latter three were incorporated as a limited companies. Baoshan Iron & Steel also owned another listed company Baosight Software (SSE:600845) as well as other subsidiaries and joint ventures.

Baosight Software

Baosight Software (Chinese: 宝信软件) is a listed company that owned by Baoshan Iron & Steel Co., Ltd., which itself is a listed company since 2000. The shares of Baosight Software had started to trade on the Shanghai Stock Exchange since 11 March 1994 (B share since 15 March 1994) as Shanghai Steel Tube Co., Ltd (Chinese: 上海钢管股份有限公司).[16][17][18]

In 2000 Baosteel Group, the parent company of Baoshan Iron & Steel Co., Ltd., acquired the controlling stake of Shanghai Steel Tube. At that time Shanghai Steel Tube was on the brink of delisting from the exchange, which "ST" prefix was added to its stock alias as ST钢管.[19]

In 2001, as part of a backdoor listing, most of the assets of the listed company had swapped with a subsidiary of Baosteel Group.[20] The company also renamed into Shanghai Baosight Software Co., Ltd. (Chinese: 上海宝信软件股份有限公司).[21][20] The shares of company had resumed from trade suspension in 2002.[20] At that time media criticized the company was heavily rely on intra-group (within Baosteel Group) business activities as revenue.[20] As of 2019, the ratio of connected transaction has decreased to 23.74% of the sales revenue.[22]

In 2004, Baosight Software was acquired by its sister company Baoshan Iron & Steel Co., Ltd.[12]

Meishan Iron & Steel
Main article: Meishan Iron & Steel

In 2004, Baoshan Iron & Steel acquired Meishan Iron & Steel Co., Ltd.[11] Despite located in Nanjing, Jiangsu Province, the steel plant was founded by Shanghai municipal government and merged with Baosteel Group in 1998.

In 2019, it was announced that the steel plant of Meishan Iron & Steel, would relocate to Yancheng, Jiangsu Province in the 2020s.[23]

Zhanjiang Iron & Steel

In October 2012, Baosteel acquired the controlling stake in Zhanjiang Iron & Steel Co., Ltd. from the State-owned Assets Supervision and Administration Commission (SASAC) of the Guangzhou Municipal People's Government.[24] After the capital increase as well as the withdrew of Guangzhou SASAC, the listed company owned 90% stake of Zhanjiang Iron & Steel.[25]

The first phase of the steel plant that owned by Zhanjiang Iron & Steel, is completed in 2016.[26]

Wuhan Iron & Steel
Main article: Wuhan Iron and Steel Company Limited

On 21–22 September 2016, a merger between Baosteel Group and Wuhan Iron and Steel Group (WISCO) was announced. Baoshan Iron & Steel would take over the listed counterpart from Wuhan Iron and Steel Group in an all-share deal,[27] while all the rights of Wuhan Iron and Steel Group would be transferred to Baosteel Group, as both corporations were supervised by the Central Government's SASAC.

Unlike Baosteel, WISCO has a longer history which could be traced back to 1955. It was once considered as the top 3 steel plants of China, along with Ansteel Group and Baotou Steel.[28] Before the merger, if counting both listed and unlisted portions of WISCO, it was the sixth largest steel company in China and 11th in the world as of 2015, according World Steel Association and China Iron and Steel Association.[29]

Equity investments

In 2002, Baosteel invested CNY 8 billion in the third pipeline of the West–East Gas Pipeline, acquiring a 12.8% stake (the pipe was incorporated as a limited company called Chinese: 中石油西北联合管道有限公司). In December 2015, a new company, PetroChina Pipelines (Chinese: 中石油管道有限公司), was formed to manage all three of the west–east pipelines, and existing share capital of the three management companies were converted into the share capital of the new company, giving Baosteel an overall 3.25% stake.[30][31]

Shareholders

Since foundation, Baosteel Group (now called China Baowu Steel Group after a merger) is the controlling shareholder of the listed company.[1][2] In turn it is owned by the Chinese Central Government. However, the ownership ratio changed from time to time.

In mid-2016, Baosteel Group and China National Petroleum Corporation, both overseen by the State-owned Assets Supervision and Administration Commission, formed a cross ownership arrangement for their listed subsidiaries.[32] After the deal, Baosteel Group held a 0.34% stake in PetroChina, while China National Petroleum Corp. received a 4.86% stake in Baoshan Iron and Steel.[32]

In December 2019, Baowu transferred a further 2.19% stake of the listed company to Beijing local government-owned Shougang Group.[33] Immediately after the deal, Baowu's stake on the listed company decreased from 64.12% to 61.93%.[33]

Markets

Baoshan Iron & Steel Co., Ltd. is a constituent of the CSI 300 pan-exchanges index.[34] As of May 2020, it was also part of the subset, the CSI 100 Index.[35]

The listed company was a constituent of the SSE 50 Index, the blue chip index of the Shanghai exchange. The shares was removed from the index in 2013 and re-instated in 2017.[36] The company was removed from the index in December 2019.[37] As of May 2020, the company is still a constituent of SSE 180 Index.

The company is ranked 323rd in 2020 edition of Forbes Global 2000.[38]

References
  1. 招股说明书概要 (Prospectus) (in Chinese). Shanghai: Baoshan Iron & Steel Co., Ltd. 17 November 2000. Retrieved 11 December 2019 – via jrj.com.cn. 发行人成立日期, 股本
  2. 2019年年度报告 [2019 Annual Report] (PDF) (Report) (in Chinese). Baoshan Iron & Steel Co., Ltd. April 2020. Retrieved 22 May 2020 – via Shanghai Stock Exchange.
  3. http://www.sse.com.cn/assortment/stock/list/info/company/index.shtml?COMPANY_CODE=600019
  4. 华强 (30 October 2000). 宝钢将发18.77亿A股 为我国境内最大上市公司. 证券时报 [Securities Times] (in Chinese). Retrieved 22 May 2020 – via Sina.
  5. "China's Baosteel heads for stock market". BBC. 6 November 2000. Retrieved 3 October 2016.
  6. "Baoshan Steel Hopes to Hold China's Biggest-Ever IPO". The Wall Street Journal. Dow Jones Newswires. 20 November 2000. Retrieved 22 May 2020.
  7. 2000年11月 宝钢股份在上交所上市 募资77亿元. 163.com (in Chinese). 20 November 2010. Retrieved 22 May 2020.
  8. 上海宝钢拟四月在港上市. 海融资讯 (in Chinese). 13 March 2000. Retrieved 22 May 2020 – via Sina.
  9. 中石化將成股市航母. 中國上市公司周刊. People's Daily (overseas edition) (in Chinese). 23 June 2001. Retrieved 22 May 2020.
  10. 黄林昊 (16 July 2001). 中石化：值得拥有的"黑色黄金" (in Chinese). Xinhua News Agency. Retrieved 22 May 2020.
  11. 关于资产收购及关联交易的公告 [Announcement of Acquisition of Assets and Related-Parties Deal] (PDF) (in Chinese). Baoshan Iron & Steel Co., Ltd. 12 August 2004. Retrieved 6 October 2016 – via Shanghai Stock Exchange.
  12. 李晶 (24 December 2004). 宝钢拟收购宝信软件 整体上市迈出重要一步. 第一财经日报 [Chinese Business News] (in Chinese). Retrieved 22 May 2020 – via 163.com.
  13. 吴善阳 (13 August 2004). 宝钢股份增发收购集团主业资产. cnr.cn (in Chinese). Retrieved 22 May 2020.
  14. 2005年度报告 [2005 Annual Report] (PDF) (Report) (in Chinese). Baoshan Iron & Steel Co., Ltd. 2006. Retrieved 22 May 2020 – via Shanghai Stock Exchange.
  15. 大事记2006年. baointl.com (in Chinese). 2013. Retrieved 22 May 2020.
  16. 上海钢管股份有限公司人民币特种股票(B股)招股说明 (in Chinese). Shanghai Steel Tube. 4 March 1994. Retrieved 22 May 2020 – via jrj.com.cn.
  17. 上海钢管股份有限公司A股招股说明书 (in Chinese). Shanghai Steel Tube. 8 October 1993. Retrieved 22 May 2020 – via jrj.com.cn.
  18. http://www.sse.com.cn/assortment/stock/list/info/company/index.shtml?COMPANY_CODE=600845
  19. ST钢管1.5亿国家股划归宝钢集团. 上海证券报 [Shanghai Securities Journal] (in Chinese). 23 November 2000 – via Sina.
  20. PT宝信22日恢复上市. 国际金融报 [International Financial News] (in Chinese). People's Daily Press. 14 May 2002. Retrieved 22 May 2020 – via Sohu.
  21. 上海钢管股份有限公司关于变更公司名称、住所、经营范围、公司章程和股票简称的公告 (in Chinese). Baosight Software. 20 June 2001. Retrieved 22 May 2020 – via china.com.cn.
  22. 2019年年度报告 [2019 Annual Report] (PDF) (Report) (in Chinese). Baosight Software. 2020. p. 12. Retrieved 22 May 2020 – via Shanghai Stock Exchange.
  23. 省政府与宝武集团签署《战略合作协议》 梅钢将从南京迁往盐城 (Press release) (in Chinese). 南京投资与规划处. 2018-12-05. Retrieved 1 December 2019.
  24. 胡飞军 (17 June 2013). 宝钢湛江项目开工1年仍打桩. 每日经济新闻 (in Chinese). Retrieved 22 May 2020 – via xinhuanet.
  25. 王晓庆 (15 October 2012). 宝钢将增资湛江项目. caixin.com (in Chinese). Retrieved 22 May 2020.
  26. 邓亚卿 (15 July 2016). 宝钢湛江钢铁二号高炉点火，未来产能将移至湛江. 北京周报 [Beijing Review] (in Chinese). Retrieved 22 May 2020.
  27. "China's Top Steel Mills Step Closer to Creating Arcelor Rival". Bloomberg. 21 September 2016. Retrieved 3 October 2016.
  28. 荣文丽; 武力 (January 2013). 中国当代钢铁工业发展的思想与实践. 河北学刊 [Hebei Academic Journal] (in Chinese). Hebei Academy of Social Sciences. 33 (1). ISSN 1003-7071.
  29. "Top steel-producing companies". World Steel Association. c. 2016. Archived from the original on 19 July 2016. Retrieved 22 May 2020. For Chinese companies, the official CISA tonnage publication was used.
  30. 2015年年度报告 [2015 Annual Report] (PDF) (Report) (in Chinese). Baoshan Iron & Steel Co., Ltd. 31 March 2016. Retrieved 3 October 2016 – via Shanghai Stock Exchange.
  31. "Discloseable Transaction – Connected Transaction" (PDF). PetroChina. 24 December 2016. Retrieved 3 October 2016 – via Hong Kong Exchanges and Clearing website.
  32. "Baosteel Seals CNPC Stake Swap With $590 Million Worth of Shares". Bloomberg. 15 August 2016. Retrieved 3 October 2016.
  33. 关于国有股份无偿划转的提示性公告 (PDF) (Press release) (in Chinese). Baoshan Iron and Steel Co., Ltd. 11 December 2019. Retrieved 15 December 2019 – via Shanghai Stock Exchange website.
  34. "Constituents List". China Securities Index. Retrieved 22 May 2020.
  35. http://www.csindex.com.cn/uploads/file/autofile/cons/000903cons.xls?t=1590172703
  36. 王磊 (6 December 2017). 宝钢股份重回上证50指数 (in Chinese). China Baowu Steel Group. Retrieved 22 May 2020 – via baosteel.com.
  37. 朱凯 (2 December 2019). 沪深300等指数样本股16日起调整. 证券时报 [Securities Times] (in Chinese). Retrieved 22 May 2020.
  38. https://www.forbes.com/companies/baoshan-iron-steel/
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