(CBN Global) March 29 -- Once one of the world's top 500 enterprises, Chinese state-owned steelmaker Bohai Steel Group Co. went into restructuring in March with debts of up to CNY192 billion (USD29.48 billion). Battered by a combination of the meltdown in the steel market and serious overcapacity since last year, Bohai Steel Group has ground to a halt.
The Tianjin Municipal Government has set up a Bohai Steel Group Creditors' Committee comprising 105 financial institutions to restructure the company's debt. It is asking these creditors to extend relevant loans and to lower the loan rate by ten percent, CBN learned from multiple sources.
Bohai Steel was founded in July 2010 with a credit line of CNY100 billion issued by eight banks. The company grew rapidly in the beginning, however, it has been grappling with a lack of product variety and weak marketing, according to Mr. Hu Yanping, a senior analyst with steel industry analysis group custeel.com.