Major private steel company files for bankruptcy protection

Haixin Iron and Steel Group, the largest private iron and steel enterprise in Shanxi Province, has started bankruptcy reorganization procedures, according to a local court on Monday.

The company, located in Wenxi county, had an annual steel output of five million tonnes and was ranked second only to Shougang Changzhi Iron and Steel Company, another state-owned enterprise, within the province. It is also the largest privately-owned company in Shanxi.

According to public data, the company recorded 10.46 billion yuan (1.71 billion U.S. dollars) in debt compared with 10.07 billion yuan in its account.

Production was suspended on March 18, due to industry overcapacity, a stagnant market, tightened credit and management issues.

In August, four lenders to Haixin filed bankruptcy plans to the Yuncheng Intermediate People's Court, aiming to reorganizing five companies within the group.