Jianlong Ordered to Drop Tonghua Buyout, Beijing Says

China’s Jilin provincial government ordered Jianlong Group to abandon a buyout plan of state-owned Tonghua Iron & Steel Group after a manager was killed in a weekend brawl, state-run Beijing News said today.

Several thousand Tonghua workers yesterday staged a rally to protest being taken over by Jianlong, attacking the closely held company’s representative Chen Guojun and battering him to death, the South China Morning Post reported, citing an unidentified police officer.

Tonghua workers blocked a railway track and prevented supplies reaching the steel mill, forcing the company to suspend production for 11 hours, Beijing News said. Police were pelted with water bottles when they arrived to restore order, it said.

Jilin’s government ordered Jianlong to drop its takeover, saying the company will never again take part in any plan to restructure Tonghua, the Beijing News said, citing a 9 p.m. broadcast yesterday on the Jilin television network. Tonghua workers abandoned their blockade of the steel mill about an hour later, the newspaper said.

Tonghua produces 7 million tons of steel a year, according to its Web site. It ranks 244th among China’s top 500 enterprises. The company posted a profit of 42.8 million yuan ($6.3 million) in June, reversing a loss, according to its Web site.

Calls to the company’s head office in northeastern China’s Changchun city weren’t answered. A police officer, who answered the phone at the Tonghua district public security bureau, declined to comment.