Du Shuanghua is the chairman of Rizhao Steel Holding Group, a major player in China’s private steel industry. The company is infamous for building many of China’s railways and bridges. Currently, Du is number 2263 on the Forbes list of the world’s wealthiest people with a real-time net value of USD 1.3B. Rizhao Steel Holding Group has been operating since 2003 in Shandong, China. Since then, Du Shuanghua has led the company to great success, and Rizhao steel is currently second in Shandong province and among the best in China.
2010 Hostile Takeover of Rizhao Steel Holding Group
Rizhao Steel Holding Group signed a contract in 2007 with an Australian company: Mount Gibson. The agreement stipulated that Rizhao would continuously purchase 1.5 million tons of iron from Mount Gibson annually for 15 years. In 2009, Rizhao sold 67% of their ownership stake to Shandong Steel. The merger propelled Rizhao Steel to one of China’s leading steel manufacturing companies. However, Shandon Steel Group, later on, attempted a hostile takeover over Rizhao Steel Holding Group.
The takeover was largely considered one of China’s biggest private steel group acquisitions by a government-owned competitor. Du Shuanghua, in turn, responded by selling a 30% equity stake at a low cost to Kai Yun Holdings to stop the hostile takeover of Rizhao Steel. Kai Yun Holdings is a big company listed in the Hong Kong stock market. It was owned and managed by relatives of the then-Chinese president, Hu Jintao. However, MR. Hu declined to work with Du as the move could be too unstable and could harm the president politically.
Rizhao’s situation worsened in 2010 when Mount Gibson accused them of breaching their contract just three years after signing it. The plaintiffs argued that they had suffered a financial loss of approximately $114 million. Rizhao Steel was found guilty and ordered to compensate Mount Gibson for their loss.
Apart from his popularity and immense involvement in the business, Du is also a philanthropist. He has continuously made cash donations that have supported numerous worthy youth causes.
Read more by visiting https://www.weekinchina.com/app/uploads/2016/09/09-Natural-Resources.pdf