From the Guardian:
Workers who beat to death a steel firm executive in north-east China had been told that 25,000 of them would lose their jobs in a takeover, according to sources quoted by state media.
Officials in Jilin province ordered the deal to be scrapped after the death of Chen Guojun, the general manager of the Jianlong Steel Holding Company, on Friday.
Beijing-based Jianlong is one of the largest private steelmakers in China. It planned to take a majority stake in the state giant Tonghua Iron and Steel Group, which makes about 7m tonnes of steel a year.
But workers at Tonghua believed it would axe thousands of jobs. A demonstration halted production at the site and quickly escalated into violence.
“Employees [many of whom are shareholders] are close to enjoying financial gains as the price of steel continues to rise,” a police officer told the official newspaper China Daily.
“Then Chen disillusioned workers and provoked them by saying most of them would be laid off in three days. Chen, saying that a total number of 30,000 employees would be cut to 5,000, infuriated the crowd.”
According to state media, Jianlong had held a sizable stake in Tonghua since 2005 and had been instrumental in restructuring the company. Last year Jianlong left the partnership following poor results – reportedly leading workers to celebrate with firecrackers.
But as the price of steel rebounded, aided by the government’s stimulus package, Tonghua’s prospects improved and Jianlong sought a majority stake in the firm.