Wusteel & Baosteel buy back shares

Wuhan Iron and Steel (Wusteel) plans to raise a maximum of RMB 15bn ($2.35bn) via a private placement to buy assets from its parent.

According to a filing to the stock exchange, the steelmaker said it would issue up to 4.2bn new shares at not less than RMB 3.6/share ($0.56)to not more than 10 investors, including its majority shareholder Wuhan Iron and Steel Group Corp.

It will use the proceeds to buy mining assets including overseas iron ore assets in Brazil and Australia from its parent. Wusteel also announced that its parent plans to overweight up to 500 million A-shares in the next 12 months. The majority shareholder, Wuhan Iron and Steel Group Corp., added holdings in the listed unit at a maximum price of RMB 4/share ($0.63).

Meanwhile, Shanghai Baoshan Iron and Steel Co (Baosteel) announced that it had bought back about RMB 1.81 million worth of its own shares as of Dec. 3. The move is part of a previously announced plan by Baosteel to buy back up to RMB 5bn ($784M) worth of shares. It said in a filing to the Shanghai Stock Exchange that it had bought back 393.08 million shares, or 2.2% of its total share capital, at RMB 4.51-4.69 each ($70-0.73) since it announced the plan in late August . in a bid to protect shareholders value and boost investor confidence.

Source: China Metals e-mail infochn@public.bta.net.cn