Interfax China reported that Xining Special Steel Co Limited, a leading special steel producer in China, has agreed to acquire a waste treatment firm in a bid to cut costs.

The steelmaker has signed an equity transfer agreement giving it ownership of Qinghai Zhengwei Industrial Group Co Limited for a total consideration of CNY 47.77 million.

The acquisition will help Xining Special Steel meet rising needs for waste treatment as it presses ahead with plans to expand production capacity over the next two years.

Both companies are based in Qinghai's provincial capital of Xining. Zhengwei Industrial has provided waste treatment services for the steel smelter since 2004.

The target's net assets stood at CNY 87.49 million at the end of 2010 and it reported net profit of CNY 18.61 million for the year out of sales revenue of CNY 979.91 million.

(Sourced from Interfax China)