Leading Chinese steelmaker Baosteel has formed a working group with the sole objective of eliminating the losses and increasing the profits of two of its subsidiaries.

The company is keen to help Shaoguan Steel in southern China and Bayi Steel in the north as both companies incurred high losses in recent years.

Guangdong province-based Shaoguan Steel incurred a loss of 1.138 billion yuan (US$175.8 million) in 2011 and a loss of 1.952 billion yuan (US$303.7 million) in 2012. After making a profit in 2013 of 101 million yuan (US$16.1 million) the company is forecast to record a loss of 1.1 billion yuan (US$175.82 million) for 2014.

Bayi Steel recorded a loss of 25.89 million yuan (US$4.1 million) in 2012 and a net profit of 33.38 million (US$5.3 million) for the first three quarters of 2014.