CITIC unit to buy Nanjing Iron stake

A FIRM owned by State-owned conglomerate CITIC Ltd. will buy a 55% stake in Nanjing Iron & Steel Group, one of the country’s top specialty steel producers, beating out top private steelmaker Jiangsu Shagang Group Co.

Fosun International Ltd. agreed to sell its stake in Nanjing Nangang Iron & Steel United Co. to Nanjing Iron & Steel Group, which will be controlled by CITIC-backed Xinye Steel through acquisition. Previously, Fosun planned to sell the stake to Jiangsu Shagang. Under the deal, Nanjing Iron & Steel issued new capital that Xinye will purchase for 13.58 billion yuan (US$1.97 billion), giving Xinye a 55.25% stake in Nanjing Iron & Steel Group.

Regulation tightened in bond fund market

CHINA’S securities regulator has tightened risk control in the country’s US$580 billion bond fund market, reducing the proportion of riskier debt mutual funds can hold and curbing leverage, said three people familiar with the matter.

Under the rules, new bond funds can invest up to 20% of portfolios in bonds rated AA+ compared with 50% previously, according to the people. Remaining investment must be in top-rated, AAA bonds.