ArcelorMittal and the Valin Group today announce that ArcelorMittal will
increase its shareholding in the downstream automotive steel joint
venture, VAMA (Valin ArcelorMittal Automotive), from 33% to 49%. VAMA is
focused on establishing itself as a premier supplier of high-strength
steels and value-added products for China’s fast growing automotive
In-line with the new shareholding agreement, Valin and ArcelorMittal
will increase their planned capacity by 25% from 1.2 million tons to 1.5
million tons. Capital investment will also increase by 15% to RMB 5.2
billion and VAMA has signed purchase agreements totalling RMB 1.8
billion for key equipment including cold rolling facilities, continuous
annealing and galvanizing lines. The joint venture is expected to become
operational in the first half of 2014.
In addition ArcelorMittal could potentially recalibrate its
share-holding in Hunan Valin Steel. The two companies have finalized a
share swap arrangement based upon a Put Option mechanism, which enables
ArcelorMittal to exercise the Put Options granted by Valin Group over
the next two years. Under this arrangement, ArcelorMittal could sell up
to 19.9% of the equity (600 million shares) it holds in Hunan Valin
Steel to Valin Group. The exercise period of the Put Options is equally
spaced with a gap of 6 months and linked to the key development
milestones of VAMA. Following the exercise of the Put Options,
ArcelorMittal would retain a 10.07% shareholding in Valin Steel as a
long term strategic cooperation.
Mr Sudhir Maheshwari, ArcelorMittal’s Group Management Board member
responsible for China, said: "We have agreed with Valin Group to
recalibrate our shareholdings in Valin Steel to focus on China’s fast
growing automotive steel market. This is a natural evolution since
ArcelorMittal already enjoys a leadership position in the automotive
markets of Europe and North America. VAMA will be based on our proven
market leading technology. We believe this is a good opportunity to
create value for our shareholders and further enhance our participation
in both China and the automotive market more broadly.”
About Valin Iron & Steel Group Co., Ltd.
Hunan Valin Iron & Steel Group Co., Ltd was set up in 1997
integrating Hunan top 3 steel companies of Xiangtan Steel, Lianyuan
Steel and Hengyang Steel. It is one of top 10 Chinese steel producers
with steel production capacity of 22 M tons. In 2011, it has steel
output of 18.22 M tons, sales revenue of 83.9 B yuan and total profit of
1.67 B yuan.
The operation of Valin Group is mainly based on the listed company:
Valin Steel, which has the state-of-the-art equipment and process for
the production of plate, hot rolled coil and cold rolled coil, seamless
steel tube and pipes, wire rod and bar with 5000 specifications and
sizes. It focus on becoming the steel industrial organizer by set-up a
complete steel chain of resource investment, steel deep drawing,
recycling economy, transportation and logistics, finance service.
ArcelorMittal is the world's leading steel and mining company, with a
presence in more than 60 countries.
ArcelorMittal is the leader in all major global carbon steel markets,
including automotive, construction, household appliances and packaging,
with leading R&D and technology. The Group also has a world class mining
business with a global portfolio of over 20 mines in operation and
development, and is the world’s 4th largest iron ore producer. With
operations in over 22 countries spanning four continents, the Company
covers all of the key industrial markets, from emerging to mature, and
has outstanding distribution networks.
Through its core values of sustainability, quality and leadership,
ArcelorMittal commits to operating in a responsible way with respect to
the health, safety and well-being of its employees, contractors and the
communities in which it operates. It is also committed to the
sustainable management of the environment. It takes a leading role in
the industry's efforts to develop breakthrough steelmaking technologies
and is actively researching and developing steel-based technologies and
solutions that contribute to combat climate change. ArcelorMittal is a
member of the FTSE4Good Index and the Dow Jones Sustainability World
In 2011, ArcelorMittal had revenues of $94.0 billion and crude steel
production of 91.9 million tonnes, representing approximately 6 per cent
of world steel output. The Group's mining operations produced 54 million
tonnes of iron ore and 8 million tonnes of metallurgical coal.
ArcelorMittal is listed on the stock exchanges of New York (MT),
Amsterdam (MT), Paris (MT), Luxembourg (MT) and on the Spanish stock
exchanges of Barcelona, Bilbao, Madrid and Valencia (MTS).
For more information about ArcelorMittal visit: www.arcelormittal.com
About Hunan Valin Iron & Steel Co., Ltd.
Hunan Valin Iron & Steel Co., Ltd. (also "Valin Steel”,) is listed in
Shenzhen Stock Exchanges. Stock code is ? 000932.
Since it went public, Valin has taken full advantage of the
opportunities for development and the capital market, and carried out
its internationalization strategy. Through share transfer, the Company
introduces ArcelorMittal, world ?1 steel enterprise, as its strategic
partner. It strives to improve its main business of steel, and
determines a differentiated developmental strategy on the basis of
professionalized production and cost control. It targets at the high-end
products in the segmented market and positions itself as a "steel
solution provider to the customers”.
Since its incorporation, Valin Steel has invested over RMB 60 B yuan
on a series of technical revamping projects, including optimization of
the processes, adjustment of the product mix, energy saving, consumption
reduction, and improvement of its competitive strength, and has
conducted a series of technical innovation and modernized the production
processes featured by large equipment, automatic operation and lean
management. The Company concentrated on several key products, including
cold-rolled and hot-rolled ultra-thin coils, heavy and wide plates,
seamless steel tubes and pipes of all calibers, and high quality wire
rod. So far, it has established plate and coil, tube and pipe, and wire
rod production lines of advanced level. It also focused on high-tech and
sophisticated products, including high strength auto steel, high grade
steel, high magnetic electrical steel, high strength shipbuilding plate,
thick plates for high power thermal power plants and nuclear plants,
high pressure boiler tubes, X80 pipeline steel. It attempts to form its
series of products with great competitive strength to meet the demand of
the domestic market substituting the imported steel. In 2011, it
produced 15.43 M tons of steel, yielding sales revenue of RMB 73.859 B
yuan with total assets of RMB 85. 969 B yuan.
About Valin ArcelorMittal Automotive Co.,
Valin ArcelorMittal Automotive Co, Ltd. (VAMA) was registered and set
up on Sept. 27 2010. It was approved by NDRC and MOFCOM with registered
capital of 1.53 B yuan, in which 33% held by Hunan Valin Steel Group,
34% held by Hunan Valin Steel, 33% held by ArcelorMittal. VAMA is built
with the state-of-the-art of automotive technology in Loudi Economic
Development Zone, Loudi city, Hunan Province.