General Steel Holdings (GSI)

Description:

General Steel Holdings, Inc. or General Steel was incorporated on August 5, 2002 in the state of Nevada. The Company serves various industries and produces a variety of steel products including: reinforced bars ('rebar'), hot-rolled carbon and silicon sheets, spiral-weld pipes and high-speed wire. Its aggregate annual production capacity of steel products is 7 million crude steel metric tons, of which the majority is rebar. Its business currently operates through five steel-related subsidiaries: General Steel (China) Co., Ltd. ('General Steel (China)'); Baotou Steel - General Steel Special Steel Pipe Joint Venture Company Limited; Shaanxi Longmen Iron and Steel Co., Ltd. ('Longmen Joint Venture'); Maoming Hengda Steel Co., Ltd.; and Tianwu General Steel Material Trading Co., Ltd. General Steel (China) has ten steel sheet production lines capable of processing approximately 400,000 metric tons of 0.75mm to 2.0mm hot-rolled steel sheets per year. Products are sold through a nation-wide network of 35 distributors and three regional sales offices. General Steel (China) uses a traditional rolling mill production sequence, including heating, rolling, cutting, annealing, and flattening to process and cut coil segments into steel sheets which have a length of approximately 2,000mm, a width of approximately 1,000mm, and a thickness ranging from 0.75mm to 2.0mm. Limited size adjustments can be made to meet order requirements. Baotou Steel Pipe Joint Venture has four production lines capable of producing 100,000 metric tons of double spiral-weld pipes primarily used in the energy sector to transport oil and steam. These pipes have a diameter ranging from 219mm to 1240mm, a wall thickness ranging from 6mm to 13mm, and a length ranging from 6m to 12m. Presently, Baotou Steel Pipe Joint Venture sells its products using an internal sales force to customers in the Inner Mongolia Autonomous Region and the northwest region of China. Longmen Joint Venture's products are categorized within the steel industry as 'longs'. Rebar is generally considered a regional product because its weight and dimension make it ill-suited for cost-effective long-haul ground transportation. Maoming Hengda's core business is the production of high-speed wire and rebars products used in the construction industry. Tianwu JV will source raw materials, mainly overseas iron ore, and is expected to supply approximately 20% to 50% of its iron-ore needs, amounting to approximately two to three million metric tons on an annual basis. The Company sells its products primarily to distributors, typically collecting payment from these distributors in advance. It competes with both SOEs and privately owned steel manufacturers. Competitors of General Steel (China) include: Tianjin No. 1 Rolling Steel Plant, Tianjin Yinze Metal Sheet Plant and Tangshan Fengrun Metal Sheet Plant; Competitors of Longmen Joint Venture include: Shanxi Haixin Iron and Steel Co., Ltd. and Gansu Jiuquan Iron and Steel Co., Ltd.; Competitors of Baotou Steel Pipe Joint Venture include: Tianjin Bo Ai Steel Pipe Co., Hebei Cangzhou Zhong Yuan Steel Pipe Co., and Shanxi Taiyuan Guo Lian Steel Pipe Co.; and Competitors of Maoming Hengda include: Guangdong Shao Guan Iron and Steel Group and Zhuhai Yue Yu Feng Iron and Steel Co., Ltd. It is subject to the requirements of environmental and occupational safety and health laws and regulations in China.