11.9 Bln Restricted Shares to be Tradable

The company has announced that 11,900,917,441 restricted shares of the company held by Baosteel Group Corporation will be tradable as of 19 Aug 2008, following which all shares of the company will be tradable for the first time, including a 73.97% stake held by Baosteel Group.

On 13 Aug 2008, the company's stock closed at RMB 7.17. Based on this figure, the total value of the 11.9 bln restricted shares will be RMB 85.32 bln. Consequently, the company’s market capitalization will be RMB 125.56 bln.

Baosteel Group has committed not to sell or transfer its holding in the company for at least 12 months as of the date when the shares became tradeable, nor to trade in the shares within 24 months. For the 12 months following the aforementioned 24 months, Baosteel Group will not sell more than 5% of the company’s total shares outstanding through the Shanghai Stock Exchange at prices lower than RMB 5.63.

Moreover, within 3 years of the 11.9 bln restricted shares becoming tradeable, the company’s shares held by Baosteel Group will not total less than 67% of total shares outstanding. However, upon the implementation of the company's share reform, Baosteel Group will no longer be restricted by the aforementioned limitations.


Source: China Securities Journal

Date: 14 Aug 2008

CN01/RL/JL/BT/MM