Clifford Chance

Clifford Chance advises iron and steel manufacturer China Baowu on US$660 million H share offer

Hong Kong: Leading international law firm Clifford Chance has advised iron and steel manufacturer China Baowu Steel Group Corporation Limited (China Baowu), an entity wholly owned by the State-owned Assets Supervision and Administration Commission of the State Council (SASAC), on its mandatory conditional cash offer (through its wholly-owned subsidiary, Baosteel Hong Kong Investment Company Limited) to acquire all issued H shares in A+H dual listed company Maanshan Iron & Steel Company Limited, at the price of HK$2.97 per H share. The offer values the H shares at HK$5.15 billion (US$660 million) and was closed on 11 November 2019.

The mandatory general offer was made after China Baowu became an indirect controller of 45.54% voting rights in Maanshan Iron & Steel Company Limited through Magang Group, an intermediate holding company holding A Shares and previously controlled by Anhui SASAC, through an equity transfer under PRC law.  In June 2019, the firm represented China Baowu and appeared in front of the Takeovers Panel of the SFC on Takeovers Code issues relating to the equity transfer.

Partner Frank Yuen led the deal from Hong Kong alongside partner Virginia Lee, with support from senior associate Ryan Wong, associates Winnie Poon and Alex Feng (Shanghai), and trainees Anson Wong, Kelvin Cheung and Karen Jiang. Beijing partner Yong Bai and senior associate Dayu Man (Beijing) advised on the antitrust aspects of China Baowu’s obtaining of control in Maanshan Iron & Steel Company Limited.

Frank Yuen offers, "China Baowu and its group companies have the largest steel production capacity in the PRC, and the second largest steel production capacity worldwide. We are delighted to have been able to support China Baowu on its most recent investment."

Clifford Chance recently advised the Official Receiver and Special Managers of British Steel on the sale of the business and assets to Jingye Steel and Iron, a privately owned enterprise from Hebei province in China.