Maanshan Steel to Sell Assets to Parent: Forecasts 9-Month LossBloomberg News
Maanshan Iron & Steel Co., Hong Kong’s second-largest listed steelmaker, said it will sell stakes in some assets to its parent for 3.84 billion yuan ($627 million) and forecast a nine-month loss.
The sale of port, international trading, transportation and machinery units and land, will “help boost liquidity and reduce financial costs,” the Maanshan, Anhui province-based company said in a statement. The company expects to book a 918.2 million yuan gain from the sale, it said.
Maanshan yesterday reported a narrowed first-half loss of 332.8 million yuan, compared with a loss of 1.89 billion yuan a year ago. The steelmaker is on course for its second annual loss as industry overcapacity weighs on prices.
The first-half result “was better than our expectation,” Barclays Plc analyst Ephrem Ravi said in an e-mailed note today.
Maanshan Steel jumped 3.9 percent to HK$2.16 at 10:36 a.m. in Hong Kong, set for the highest since March 13. Earlier it advanced as much as 7.2 percent.
The company will incur losses for the first nine months of this year as the cost of raw materials increased faster than steel prices, it said in a separate statement, without elaborating. Maanshan may have a loss of 390.6 million yuan in 2013, according to the average of 16 analyst estimates compiled by Bloomberg.
— With assistance by Helen Yuan