BAOSTEEL, China’s largest steel group, has made its second investment in a Chinese port after spending Yuan673.2m ($99m) to take a 20% stake in Yantai port, which has been set up at a cost of Yuan3.4bn.
The port company was formally launched on Saturday as part of a restruc- turing of the Yantai Port Group and to pave the way for the expansion of Yantai port in Shandong province, northern China.
The port group has taken a 67.6% stake in the port company, while Baosteel and Baosteel Resources have a combined 20% interest. A further 10%,is owned by the China Shipping Group, while the remaining stake is held by SDIC Communications.
The launch of Yantai port ended 19 months of discussion between the port group, Baosteel and China Shipping after the three initially began talks to restructure the port entity in June 2008.
Details of the planned expansion the new port company will carry out have still to be finalised but are expected to include development of new bulk terminals and logistics facilities.
This will increase cargo volumes, ship calls and revenues. Port executives are hoping to almost double cargo volumes, which topped 123m tonnes last year including 26m tonnes of iron ore.
Baosteel's investment at Yantai coincided with its development of a steel pipe manufacturing plant that will produce large-diameter high-alloy pipes for the petroleum and natural gas industries when it comes into full production around luly this year. The company already has an 8% stake in Zhanjiang port in south China's Guang- dong province.