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CISC Establishes Debt-to-Equity Corporation
A debt-to-equity subsidiary corporation to the Capital Iron and Steel Company (CISC), one of China's largest steel and iron producers, was established Friday.
The newly established Xingang Company still considers the iron and steel industry as its major business. It will adopt the modern enterprise system and become a limited liability company.
The Capital Iron and Steel Company owns 53 percent the Xingang Company's shares, while Huarong, Cinda and Orient Asset Management Corporations (AMCs) have nearly 3.6 billion yuan (about 428.7 million U.S. dollars) debt-equity stock rights.
In recent years, the development of the steel giant has been troubled by heavy debts, employee redundancy, and being too big.
Signing a framework agreement with the three asset management corporations at the end of last year, CISC was among the first group of enterprises to take the debt-to-equity swap in China.
The debt-equity swap will help CISC to reduce its debts, accelerate its technical renovation, and increase the competitiveness of its products.
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