Chongqing Iron & Steel (SHE:601005, HKG:1053) proposed to acquire a 0.53% equity in Baowu Group Environmental Resources Technology through a capital injection, according to a Hong Kong bourse filing on Wednesday.
The Chinese iron and steel company's Hong Kong shares fell 2% during the afternoon trade.
Chongqing will contribute its 1.61% equity in Baowu Water Technology, which is valued 58.1 million yuan, in the capital injection.
After the transaction, Chongqing will no longer hold any stake in Baowu Water.
Meanwhile, Baowu Environment's registered capital will rise to 1.04 billion yuan from 711.6 million yuan. Chongqing is one of Baowu Environment's 13 new stakeholders.