In October 2022, after Fosun released the news of selling 60% of Nanjing Steel Union, it caused a wide response in the market. On the one hand, this is the market's high recognition of Nangang's high-quality assets, on the other hand, it also causes the majority of employees to pay high attention to the future development of Nangang. Under the care and guidance of shareholders and the full support of all employees, Nangang Group complied with the principles of rule of law and marketization, actively responded to the aspirations of employees and retirees, fully considered the future development and industrial advantages of Nangang, and finally introduced CITIC Group as a strategic investor. Hubei Xinye Steel, a subsidiary of CITIC Group, increased the capital and shares of Nangang Group, and Nangang Group exercised the shareholder's preemption right to acquire the 60% target equity of Nanjing Steel Union sold by Fosun. Citic Group holds 55.2482% of the shares of Xinnan Steel Group.
As the cradle of China's modern industry, Nanjing has always built steel as an important pillar industry for its own development, and fully supports key steel enterprises such as Nangang to grow bigger and stronger, transform and improve. In 2022, the city's steel industry completed output value of 121.8 billion yuan, accounting for nearly 8% of the industrial proportion on the regulation. Not long ago, the municipal Party Committee and the municipal government formulated and introduced a three-year action plan to promote the industrial strength of the city, comprehensively promote the high-end, intelligent and green development of the steel industry, and clearly support the diversified development of key steel enterprises such as Nangang, extend to product customization and clustering chain, and accelerate the construction of intelligent manufacturing industrial parks.
Citic Group is a multinational conglomerate and one of the world's top 500 enterprises, as well as an old friend and long-term strategic partner of Nanjing. As early as 2020, the two sides signed a strategic cooperation agreement to deepen cooperation in financial services, infrastructure construction, comprehensive urban development and other fields, and achieved a number of important results. Since last year, Citic Group has contributed to the acquisition of Nangang Group, and supported Nangang Group to exercise its priority, acquire the equity of Nangang held by Fosun, and promote the establishment of new Nangang Group. This is a "strong alliance" between CITIC Group and Nanjing's outstanding enterprises, and a "two-way rush" to the development of Nanjing's leading industries. We believe that with the strong support of CITIC Group, Xinnan Steel Group will be able to further expand and become a global leader in the fields of special steel and metal materials. We sincerely hope that CITIC Group will take this opportunity to further strengthen cooperation between its five business segments (comprehensive finance, advanced intelligent manufacturing, advanced materials, new consumption and new urbanization) and Nanjing, and join hands to create a better future. We also sincerely welcome Fosun Group to continue to layout and invest in Nanjing and achieve mutually beneficial and win-win development with us.
Citic Pacific will carry out Nangang related work from three aspects: First, promote cultural integration and maximize the cohesion of striving force. Second, deepen synergy and interaction to help achieve high-level scientific and technological self-reliance; The third is to enhance the resilience of enterprises, and further promote the high-end product structure and customer service characteristics. Under the strong leadership of CITIC Group, CITIC Pacific will continue to fully, accurately and comprehensively implement the new development concept, take a steady path of high-quality development, seize new opportunities, bravely undertake new missions, and open up a new chapter.
