A prospective merger will cement China’s dominance in the global steel industry
In the coming period, China is witnessing a possible merger between “Anshan Iron & Steel Group”, and “Benxi Iron & Steel Group”. This merger will strengthen China’s dominance in the global steel industry.
Bloomberg said the potential merger between Anshan Iron & Steel Group and Benxi Iron & Steel Group would likely create one of the largest steelmakers in the country. World, thus strengthening China’s dominance in the sector.
Iqra also the Holding Company for Metal Industries receives 9 offers to develop iron and steel Bengang Steel Plates Co., a subsidiary of Benchi Corporation, announced the plan in a disclosure statement to the stock exchange, without providing further details.
Discussions about the merger of the two companies have taken place since at least the beginning of this century, without reaching a conclusion. The revival of the talks comes amid a drive to boost China’s giant steel sector – which has a capacity of one billion tons annually – to focus on bigger and better producers.
“We view the potential deal as a positive trend towards the rise of mergers and acquisitions in the steel sector, and we expect further mergers between steel producing companies in the coming years,” Citigroup analysts wrote in a note. Analysts said it is likely that the Angang Group will take the initiative to integrate steel plants in the northeastern provinces.
Rise to the third rank in the world
The Ansteel Group was the seventh largest steel manufacturer in the world in 2019, with an output of 39.2 million tons, and the Benchey Group ranked nineteenth with a production capacity of 16.2 million, according to data from the World Steel Association.
The merger between the two is likely to lead to the formation of a company that will surpass Japan’s Nippon Steel Corp, with an output of 51.7 million tons, to become the third largest in the world.
China Baowu Steel Group, the country’s largest steelmaker, has already embarked on a series of mergers, with the group’s combined assets exceeding the size of ArcelorMittal SA, the world’s largest company.