A group of five Chinese companies consisting of CITIC Group, Baosteel Group Corporation, Anshan Iron & Steel Group Corporation, Shougang Corporation and Taiyuan Iron & Steel Group Co., Ltd. formed a consortium named China Niobium Investment Holdings Ltd. and acquired 15% stake in Companhia Brasileira de Metalurgia e Mineração -CBMM for US$1.95 billion.

CBMM, a Brazilian company located in Araxá in the state of Minas Gerais, is the world leader in the development, industrialization and commercialization of niobium products. CBMM has over 50 years of successful operating history and has been a pioneer in developing niobium applications and related technology.

Niobium is mainly used as an alloying element in steels, increasing strength and toughness simultaneously, and resulting in end-products with enhanced efficiency and environmentally friendlier. Key applications include: automotive industry, oil and gas transmission pipelines, large structures such as bridges, towers and buildings, and aircraft engines.

Brazil holds the largest part of total known niobium reserves in the world according to data from official agencies, and CBMM is thought to hold rights to the best niobium reserves in Brazil. Such investment has a very relevant strategic value for all parties.

Worldwide demand for niobium recorded an annual growth rate of some 10% from 2002 through 2009, buoyed by growing need for high-grade steel. Demand for niobium is projected to grow faster than the expansion in world crude steel production.

Companhia Brasileira de Metalurgia e Mineração (CBMM) is part of the Moreira Salles Group and is involved in the extraction, processing, manufacturing and marketing of niobium-based products.

A profit sharing agreement between state-owned CODEMIG and CBMM ensures the rational exploitation of the niobium deposit located near the city of Araxá, Minas Gerais, Brazil. The contract concedes 25% of CBMM's net operational profits to the state of Minas Gerais.

CBMM is the only niobium producer present in all market segments. It has subsidiary companies in Europe CBMM Europe BV (Amsterdam), Asia CBMM Asia Pte Ltd. (Singapore) and in North America, Reference Metals Company Inc. (Pittsburgh).

CITIC is a conglomerate that now owns 44 subsidiaries (banks) including those in Hong Kong, the United States, Canada, Australia and New Zealand. The company has also set up representative office in Tokyo, New York and Rotterdam.

By the end of 2006, CITIC’s total assets stood at RMB 929.2 billion with an after-tax profit of RMB 6.09 billion.

5th Sept. 2011