Sinosteel branches out to cover all bases
Updated: 2008-03-25 10:11
While many Chinese entrepreneurs look to top foreign companies for guidance, Huang Tianwen couldn't find the right business on which to model his company.
Huang's been president of State-owned Sinosteel Corp since 2003. In that time, he's helped the company transform from iron ore trader to an integrated steel industry services provider.
Formed in 1993, Sinosteel's businesses now cover metallurgical mining resources exploitation and processing, metallurgical raw materials and products trade and logistics, technical support and equipment manufacturing.
"We provide full services to steel companies, both in upstream and downstream sectors," Huang said.
"As the world's largest steel manufacturer, China has many big steel companies. But in the service sector, no other company in the country can provide the full range of services we do.
"Globally, I don't know of any big company that covers the business range Sinosteel does."
Sinosteel's restructure has brought the company great success. Its 2007 sales increased 83 percent to 111.24 billion yuan ($15.77 billion) and its profit also saw 180 percent growth last year.
"Now we are preparing for an IPO," Huang said. "We will reinforce our resources development, trade and logistics, engineering, science and technology."
Huang said the company is focusing on boosting manufacturing facilities like raw material and equipment production to increase service capacity.
Last year, the company took over Jilin Ferroalloy Co Ltd, China's largest ferroalloy producer. That deal boosted Sinosteel's ferroalloy manufacturing capacity. Now it's become one of the world's major ferroalloy producers.
China's ferroalloy industry is likely to see more consolidation in the next few years and Sinosteel plans to use this to its advantage, Huang said.
Sinosteel signed four important deals in 2006. Its machinery equipment manufacturing business was bolstered when it took over Jilin Xinye Equipment Co Ltd, Xingtai Mechanical Roll Co Ltd and Hengyang Nonferrous Metallurgical Machinery Co. Meanwhile, Sinosteel's raw material production capacity was boosted by its takeover of Jilin Carbon Co Ltd.
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