China Steel Billion Transfers Beijing-Guangdong Metallurgy

China National Steel Corporation plans to transfer the entire property of the wholly-owned subsidiary Beijing-Guangdong Metallurgical Union Co., Ltd. and 40.04 million yuan of claims at a listed price of 100 million yuan. Since the main asset of Beijing-Guangdong Metallurgy is Foshan Jingyue Hotel, Sinosteel’s move is also a response to the SASAC’s call for the withdrawal of central enterprises from the hotel industry.

Beijing-Guangdong Metallurgical Union Corporation was established in 1990 with a registered capital of 1.41 million yuan. It specializes in the production of steel, pig iron, non-ferrous metals and calendered products, building materials, coke, ferroalloys, carbon products, scrap steel, and coking products; Transit, material storage, rubber products; lease of self-owned shops. According to public information, the company is basically in an unoperated state in recent years and has no employees. In 2010, the company realized operating income of 10.55 million yuan and profit of 700,000 yuan. In the first quarter of 2011, the company realized revenue of 2.49 million yuan and a loss of 140,000 yuan. As of March 31, 2011, the company's net assets -18.68 million yuan, the book has been insolvent.

As the main asset of Beijing-Guangdong Metallurgy is its Foshan Jingyue Hotel, which is located at No. 169, Guangfo 1st Road, Huangpi, Nanhai District, Foshan City, Guangdong Province, Beijing-Guangdong Metallurgy Co., Ltd. and its affiliated Foshan Jingyue Hotel own Beijing Tower A and Jingyue Building. Building B, Block B, Beijing-Guangzhou Hotel, and other housing construction assets of more than 23,000 square meters, allocated land of nearly 15,000 square meters. Therefore, when assessing assets, the total assets of Beijing-Guangdong metallurgy were assessed as 82.05 million yuan, and the net assets after evaluation were 45.51 million yuan.

The transfer of the entire property rights of Beijing-Guangdong Metallurgy also included the claims of China Steel Corporation. According to the disclosure, the bonds that were transferred together include: 39.9 million yuan from Beijing-Guangdong Metallurgical Group owed to Sinosteel Group, 13 million from Zhongnan Iron and Steel Company, a wholly-owned subsidiary of Sinosteel Corporation, and a wholly-owned subsidiary of Sinosteel Group, China Iron and steel charge northwest company's 8713 yuan.

At the same time, there is a contingent liability for the transfer of the subject. Xie Sixing, criminal plaintiff with civil suit, v. Foshan Jingyue Hotel, for a total of 590,000 yuan in damages, a civil judgment letter from the Foshan Intermediate People's Court of Guangdong Province (2010) Zhuhai Yuede, Foshan, China Assuming any responsibility, the plaintiff has already appealed to the High Court of Guangdong Province. There is no judgment at present.

Sinosteel apparently did not miss this subsidiary that had been closed down. There are no harsh conditions imposed on the request of the intended transferee. The commitment of the intended transferee is also limited to guaranteeing local employment and maintaining the company’s own goodwill. For example, the intentional transferee needs to agree that a team member of the Dali Town police station's stationed company is still responsible for the monthly expenditure of the Beijing-Guangzhou Hotel to which the target company belongs; the employee who agrees to lease the company property continues to pass the target company's ownership. The Beijing-Guangzhou Hotel ** account pays **; agrees that after the completion of this equity, the company will no longer use the “China Steel” trademark as the business name, and will no longer use “China Steel”, “sinosteel” and “in the business activities”. Sinosteel graphic" trademark etc.