Maanshan Iron & Steel Company Limited has signed an Equity Transfer Agreement to sell its entire 92% holding in Ma Steel (Cihu) Processing and Distribution Co., Ltd. to controlling shareholder Magang (Group) Holding Company Limited for RMB136.31 million in cash.
Transaction highlights • Date signed: 29 September 2026. • Consideration: RMB136.31 million, payable by Magang Group within 10 business days of signing. • Valuation basis: Asset-based appraisal placed Ma Steel (Cihu)’s equity at RMB148.16 million; the purchase price represents 92% of that value and reflects a modest 0.35% premium to net book assets of RMB149.17 million (31 January 2026). • Completion: Effective on the last day of the month in which payment is received; equity registration changes to be completed within 10 business days thereafter. • Post-deal status: The Company will cease to own any stake in Ma Steel (Cihu), which will no longer be consolidated into group accounts.
Regulatory classification With Magang Group already holding 48.49% of Maanshan Iron & Steel, the disposal is a connected transaction under Hong Kong Listing Rules. The size tests fall between 0.1% and 5%, requiring announcement but not independent shareholders’ approval.
Profile of the target Ma Steel (Cihu), established in 2004, provides processing, distribution and warehousing for cold-rolled, galvanised, silicon and colour-coated steel.
Key audited figures (PRC GAAP): – FY 2024: revenue RMB3.11 billion; profit after tax RMB50.81 million; total assets RMB0.36 billion. – FY 2025: revenue RMB1.65 billion; profit after tax RMB0.34 million; total assets RMB0.24 billion. – January 2026: revenue RMB31.28 million; net loss RMB1.28 million; total assets RMB0.20 billion.
Strategic rationale and financial impact The subsidiary’s core production facilities were demolished in 2024; it now operates mainly as a steel-trading entity and incurred a loss in early 2026. Divestment will:
1. Generate approximately RMB136 million in cash, earmarked for working-capital needs. 2. Remove a non-core, loss-making asset and improve overall asset quality. 3. Allow management to concentrate resources on the Company’s primary steel manufacturing operations.
Maanshan Iron & Steel expects to record a disposal gain of about RMB136.31 million at the consolidated level, subject to audit.
Governance The Company’s board approved the transaction on 29 September 2026; directors holding positions at Magang Group abstained. Independent non-executive directors agreed that the terms are fair, reasonable and in the interests of all shareholders.