In fact, under the trend of intensifying the merger and reorganization of steel enterprises in our country, the M & A funds started to exert force since 2017.

On the 9th, Shanxi SDIC, Shantui Group, MCC Jingcheng and Jianlong Group jointly initiated the establishment of the Shanxi Steel Industry Structure Adjustment Fund. It aims at using equity cooperation as a link and market-based operation as a means to promote the stock reorganization and specialized reorganization of steel and its upstream and downstream industries and provide operational efficiency and market competitiveness through technical and management innovation. It is reported that the structural adjustment fund is expected to total 50 billion yuan, the first phase of 50 billion yuan.

On the one hand, the state has proposed to achieve the goal of 60% concentration in the steel industry by 2025; on the other hand, the concentration will also be a bigger and stronger one for the enterprise itself. The next five years will be the steel industry mergers and acquisitions a breakthrough in the crucial stage.

In September 2016, the State Council issued the Guiding Opinions on Promoting the Merger and Reorganization of Zombie Enterprises in the Iron and Steel Industry, stating that by 2025, the top ten Chinese steel industry enterprises will have 60% -70% concentration of production capacity, including 80 million tons Three to four steel-class groups, six to eighty thousand-ton steel groups, and some specialized steel groups.

Take Hebei Province as an example. By 2020, the number of steel enterprises in Hebei will be reduced from 109 to 60, creating a pattern of "2310" mergers and acquisitions. Forming a large-sized iron and steel enterprise group headed by Hegang and Shougang Group and forming three large-scale steel groups with private-owned steel enterprises in the regional market and ten private-owned steel enterprises with the advantages of special products. Shanxi Province also plans to reduce its mergers and acquisitions from the 27 steel companies in the past to 10.