History of Hunan Valin Steel
The Hunan Valin Steel Group is a leading global steelmaker. In 2018 the company produced ~23 million tonnes of steel, making it the 14th largest steelmaker in the world.
The timeline below covers the history of the firm.
- 1997: Hunan Valin Steel Company Ltd founded in 1997.
- 1999: Listed on the Shenzhen Stock Exchange.
- 2005: Mittal Steel buys 37% stake in Valin subsidiary.
- 2009: Valin acquires small stake in Fortescue Metals.
- 2014: JV with Mittal Steel to enter Chinese car market.
- 2016: Strategic shift annnounced into financial services.
- 2017: Reorientation plan away from steel abandoned.
- 2018: Disposal by ArcelorMittal of its ownership stake.
- 2019: Reduces ownership stake in Fortescue to 13.06%.
- 2005: The purchase by Netherlands-registered Mittal Steel of an equity stake in a Hunan Valin subsidiary signified the first investment by a major foreign steelmaker in the Chinese steel sector. This was regarded as an important sign of the growing interest of foreign steel companies in the Chinese market.
- 2009: This was an acquisition of a 16.5% stake in Australia's third biggest iron ore producer at the time, Fortescue Metals, for US$771 million.
Chinese investors generally were keen on investment in debt-strapped Australian resources companies at this time.
- 2014: The JV went operational in June 2014. Annual production capacity was ~1.5 million tonnes, with manufacture of various metal chassis and wheel parts.
- 2016: Valin strategic shift driven by overcapacity in the Chinese steel market and reduced profitability.
The change of strategy involved Valin acquisition of notable stakes in several financial and electricity companies.
These acquisitions included a 100% equity stake in Fortune Securities; a 96% stake in Hunan Trust; a 29.19% stake in Jixiang Life Insurance; a 100% stake in Xiangtan Valin Energy Saving Power Generation; as well as a 100% stake in Hunan Valin Energy Saving Power Generation.
- 2017: Hunan Valin in Feb 2017 received approval from China's securities regulator to issue shares and purchase a 100% stake of Hunan Caixin Investment Holding Co. Ltd., a financial holding platform. At the same time, Hunan Valin planned to sell off its steel production assets.
By mid-2017 however, this plan got abandoned. An improved performance of Hunan Valin's steel production assets was cited by the steelmaker as the reason for the change of plan.
- 2018: The 2016 / 2017 developments caused ArcelorMittal to transfer some 10% of its ownership of Hunan Valin Steel (its entire stake worth ~$166 million) to the state-owned China Reform Fund.
Following ArcelorMittal's ownership exit, it is understood that Valin will continue to produce and supply advanced automotive steel light-weight solutions to automotive OEMs, helping them to meet evolving standards of safety and energy efficiency as required by the Chinese automotive industry.
- 2019: Hunan Valin reduced its equity stake in the Fortescue Metals Group by about 1.14 per cent to 13.06 per cent in early March 2019.
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