Planning for more than two years of major asset restructuring and blowing up Taigangs stainless steel

category:Finance
 Planning for more than two years of major asset restructuring and blowing up Taigangs stainless steel


According to the announcement, over the past two years, listed companies have actively promoted the restructuring, including the initial contact with relevant shareholders of Xinhai new materials and signing the memorandum of cooperation; organizing intermediary agencies to carry out due diligence, audit, evaluation and other related work on the subject assets; Taiyuan Iron and steel, the controlling shareholder of the company, and Baowu iron and Steel Group Co., Ltd. of China and the transaction partner One of the parties, Shandong Xinhai Technology Co., Ltd. (hereinafter referred to as Xinhai Technology), signed a strategic cooperation framework agreement on major asset restructuring.

The target Xinhai new material industry is non-ferrous metal manufacturing industry, and its main business is the production and sales of nickel alloy and the development, utilization and transfer of related technologies. The shareholders of Xinhai new materials are Wang Wenlong, Wang Wenguang, Xinhai Technology and Xintai mining.

According to the annual report of TISCO stainless steel in 2019, Xinhai Technology is the second largest supplier of listed companies. Xinhai science and technology and Xinhai new materials are the main raw materials of stainless steel production - nickel alloy. Therefore, the acquisition of Xinhai new material is considered to be a heavy asset acquisition restarted by TISCO stainless steel after the completion of the core asset integration of TISCO group in 2008.

According to the data, stainless steel is mainly engaged in the production and sales of stainless steel and other steel products, billets and metal products; domestic trade, import and export of raw and auxiliary materials for steel production.

After the record of ten year best in 2018, TISCO stainless steels performance in 2019 was cut back, with revenue of 70.419 billion yuan, down 3.46% year-on-year; net profit attributable to shareholders of listed companies was 2.119 billion yuan, down 57.43% year-on-year. Among them, in 2019, the company accrued 805 million yuan of impairment reserves for various assets, and turned back 15.51 million yuan of impairment reserves, including 798 million yuan of inventory depreciation reserves.

According to the financial report, the gross profit margin of the companys main businesses shows a downward trend.

Photo source: Financial Report

In addition, the risk of stainless steel industry in TISCO is more serious. Recently, the company replied to investors questions on the interactive platform that according to the statistics of the Ministry of industry and information technology of the peoples Republic of China, the proposed scale of national steel capacity replacement in 2020 is nearly 200 million tons, and the domestic steel capacity is about to enter the release peak period. The company has put into operation about 70 million tons in the whole year, which increases the risk of oversupply, makes the situation of oversupply more severe, and affects the stability of steel prices. Zhou Jinxiao, a representative of stainless steel securities affairs of TISCO, said in the road show on June 17 that since May, the iron ore price has been in a unilateral upward trend, the mechanization and unmanned degree of foreign mining is very high, the impact of the epidemic on it is limited, and according to the current mine price, the profits of the mine are at a high level. This years NPC and CPPCC will once again release signals of economic stability, strengthen the construction of two new and one heavy, and it is expected that steel prices will maintain a strong shock pattern in the future. Source: editor in charge of interface news: Yang Bin_ NF4368

In addition, the risk of stainless steel industry in TISCO is more serious. Recently, the company replied to investors questions on the interactive platform that according to the statistics of the Ministry of industry and information technology of the peoples Republic of China, the proposed scale of national steel capacity replacement in 2020 is nearly 200 million tons, and the domestic steel capacity is about to enter the release peak period. The company has put into operation about 70 million tons in the whole year, which increases the risk of oversupply, makes the situation of oversupply more severe, and affects the stability of steel prices.