SHANGHAI, Jan. 5 (SMM) -- On December 24th, the State-Owned Assets Supervision and Administration Commission of Hunan Provincial Government and the Hunan Nonferrous Metals Holding Group (HNG) signed an agreement to allow increases in capital with China Minmetals Corporation (China Minmetals) and China Minmetals Non-ferrous Metals Company (China Minmetals Non-ferrous Metals). According to the agreement, China Minmetals Non-ferrous Metals will increase its shares in HNG to 49%, at a cost of RMB 5.559 billion. On December 28th, the same commission and HNG signed a transfer agreement with the two enterprises which would allow China Minmetals Non-ferrous Metals to acquire 2% of the HNG shares owned by the commission at no charge. With this increase in shares, China Minmetals became the controlling shareholder of HNG, with 51% of HNG shares, with the State-Owned Assets Supervision and Administration Commission of Hunan Provincial Government holding the remaining 49%. After this reorganization, China Minmetals will obtain actual control of three listed companies, including Hunan Nonferrous Metals Company, Zhuzhou Smelter Group, and China Tungsten and Hightech Materials Company, which were all previously owned by HNG. The new China Minmetals will now own a total eight listed subsidiary companies, and market players believe the move by China Minmetals is a strategic win for the company.
It is worth noting that earlier this year, China Minmetals reorganized OZ Minerals, an Australian lead and zinc ore operator, in a move to provide lead and zinc ores for Zhuzhou Smelter Group (capacity of 500 kt/yr zinc ingot and zinc alloy), previously under control of HNG. Similar reorganizations will be made within China's zinc industry as part of the Central Government structural adjustments in industrial production.
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