BEIJING – Capital Steel Co, Ltd. (Capital Steel) will participate in the establishment of Beijing Automobile Co., Ltd. (BAC) by investing all the equity shares it holds in Beijing Automobile Investment (BAI) plus some fund. The estimated holding is 18.31 percent, the second biggest among all shareholders, according to an announcement released by the company on August 20.
Early in 2003, Capital Steel Group, parent company of Capital Steel, paid ¥500 million ($73.5 million) for 23.62 percent shares of BAI. In December 2006, Capital Steel purchased this amount of share and entered the auto industry indirectly. In August 2008, Capital Steel established Beijing Capital Steel Cold Rolled Sheet Co., Ltd. jointly with Capital Steel Group and BAI.
According to people in the industry, the earlier acquisition of BAI has shown Capital Steel’s determination towards auto industry and the steel magnate has successfully become the supplier of Beijing-Hyundai, Beijing Benz-Daimler, Beiqi-Foton and Beijing Automotive Works.