Fosun Group Sells Nangang Stake to CITIC Unit for $2 Billion

Fosun International Ltd. agreed to sell its 60% stake in the parent company of Nanjing Iron & Steel Co. to a firm owned by CITIC Ltd., after terminating an earlier plan to offload the holding to Jiangsu Shagang Group Co.

(Bloomberg) — Fosun International Ltd. agreed to sell its 60% stake in the parent company of Nanjing Iron & Steel Co. to a firm owned by CITIC Ltd., after terminating an earlier plan to offload the holding to Jiangsu Shagang Group Co.

Fosun will sell its stake in Nanjing Nangang Iron & Steel United Co. for 13.58 billion yuan ($2 billion) to Nanjing Iron & Steel Group, which will be controlled by CITIC-backed Xinye Steel through acquisition, the Chinese conglomerate said in an exchange filing on Sunday.

In a separate filing, CITIC said the purchase will increase its unit’s special steel production capacity and extend its lead in the industry. Nanjing Iron’s products are complementary to the group’s existing products in the steel business, it said.

In March, Fosun said its subsidiaries agreed to sell the equity to Shagang Group for the same price. Fosun’s dollar bonds jumped in October when Bloomberg News first reported the deal.

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