Anshan Iron & Steel Group (347), China’s second-biggest steelmaker, obtained a 14.6 billion yuan ($2.32 billion) loan from a group of banks to develop a vanadium and titanium project in the western province of Sichuan.
Unit Pangang Group Co. (PISZ) signed the loan with lenders including Industrial & Commercial Bank of China and Bank of China Ltd. for the 24.3 billion yuan project in Xichang, according to a statement on Pangang’s website today.
Pangang Group is developing vanadium, which is used to strengthen steel, as Chinese manufacturers face declining profit margins because of high raw-material costs and rising competition. The project fits in with the central government’s strategy of improving employment and infrastructure in the western provinces, Pangang said in the statement.
The project will have a capacity of 18,800 metric tons of vanadium products a year and 3.9 million tons of steel used in pipes, automobiles and appliances, according to Newssc.org, a news portal affiliated to the Sichuan provincial government.
Zhou Jun, a spokesman of Pangang, didn’t answer calls made to his mobile phone seeking comment.
The other lenders in the group are Export-Import Bank of China, Agricultural Bank of China Ltd. and Liangshan Prefectural Commercial Bank. Pangang Group Finance Co., a unit, is also involved in the facility, the company said.
Anshan Iron & Steel’s unit, Angang Steel Co., is the biggest Chinese steelmaker listed in Hong Kong. Pangang Group owns a 35 percent stake in Pangang Group Steel Vanadium & Titanium Co., according to data compiled by Bloomberg.
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