BEIJING, Dec 26 (Reuters) - Industrial and Commercial Bank of China (ICBC) has signed three debt-for-equity swaps with Shanxi province’s highly indebted state-owned coal and steel firms, the bank said late on Monday.
China’s biggest lender ICBC has agreed to invest in Taiyuan Iron & Steel (Group), Datong Coal Mine Group and Yangquan Coal Industry (Group) to swap their existing debt and reduce their corporate leverage, the bank said.
Heavy industries such as coal and steel have languished as China relies increasingly on higher-end technology and consumption for economic growth and seeks to shut underperforming mines and plants.
China’s northern province of Shanxi is its biggest coal producing region. Shanxi produced 944.1 million tonnes of coal last year, amounting to 25.6 percent of the national total.
The total value of three debt-for-equity swaps was 30 billion yuan ($4.3 billion), which will cut the three firms’ leverage by as much as 10 percent, state-run local media Shanxi Youth Finance said in a report released on its social media account.
ICBC didn’t confirm that total when contacted by Reuters.
$1 = 6.9485 Chinese yuan renminbi Reporting by Shu Zhang and Matthew Miller; Editing by Ruth Pitchford