DECEMBER 19 -- Chenzhou Mining Group (002155.SH) sold a 100 percent stake in subsidiary, Xinjiang Tuoli Xinda Gold Mining, and an 80 percent stake in subsidiary, Xinjiang Tuoli Dadi Baobei No.8 Gold Mining, for a total of RMB 52 million, reports China Business News, citing a company filing.

The purchaser of the equity stakes, natural person Liu Yang, has paid for the share acquisitions on December 12.

According to the report, the main reason for the stake sales was that the subsidiaries had reported losses in consecutive years.

Among the company’s 14 subsidiaries, seven subsidiaries which are not located in Hunan recorded losses in 2010, with total losses hitting RMB124 million. An unnamed industry analyst said the earnings growth of Chenzhou Mining in 2011 will depend mainly on the surge in gold and antimony prices.

External investments made by the company often resulted in losses due to internal management problems and poor risk controls, added the analyst.

Chenzhou Mining had purchased Xinjiang Tuoli Xinda Gold Mining for RMB 43.6 million , and Xinjiang Tuoli Dadi Baby 8th Gold Mining for RMB 53.4 million  in May 2008.

Both companies had less than RMB 20 million  of registered capital at the time of the acquisitions.