Xu to fill power vacuum at Baosteel

2007-12-27 21:45:07 Shanghai Daily

BAOSTEEL Group Corp Chairman Xu Lejiang was again elected as chairman of the company's listed unit, to fill a power vacuum after his predecessor Ai Baojun was appointed to a new government post.

Xu, 48, was approved as a board director of Shanghai-listed Baoshan Iron & Steel Co at a shareholder meeting yesterday afternoon. He was later elected as chairman by the board, according to a stock exchange filing last night.

Ai, 47, was yesterday named as a vice mayor of Shanghai.

Ai took the chairman post of Baoshan Steel in April this year from Xu. Ai had held senior posts at Baosteel as well as at the listed arm since 1998. He joined the company in 1994.

Xu became Baosteel's chairman early this year after Xie Qihua, 64, the renowned "Iron Lady," retired. Xu earlier became Baoshan Steel's chairman in May 2006, also replacing Xie.

A senior Baosteel source said Xu's chairman role in the listed arm this time might be temporary.

"The company is turning into a modernized corporation, and for a modernized company, it's better not to have the same person as head of the group company and the listed arm," he said.

Yesterday's shareholder meeting also approved Baoshan Steel's proposal to acquire assets, including a steel-plate plant from parent Baosteel for about 14.3 billion yuan (US$1.96 billion), to meet growing demand from the ship making industry.

Baoshan Steel is 73.97-percent-owned by Baosteel as of the end of September.

Separately, Baoshan Steel, Nippon Steel Corp and Luxembourg-based ArcelorMittal plan to invest 1.6 billion yuan to build a new automotive sheet line in their joint venture plant in Shanghai, as demand for high-end auto steel rises.

The new 450,000-ton-a-year line for zinc-galvanized steel sheets will add to the existing 800,000-ton-a-year plant. It will start operation in 2010, the Chinese mill announced yesterday on its Website.

Baoshan Steel's shares were suspended from trading yesterday.