China''s Baosteel Group, the country''s second-biggest steelmaker, has put a 40 percent stake in a Shanghai-based stainless steel joint venture up for sale, with a price tag of 1.93 billion yuan ($298 million).

The decision follows the sale of a 55 percent stake in the venture, Shanghai Krupp Stainless (SKS), by Finland''s Outokumpu in October, as Europe''s largest stainless steel company looked to reduce debt.

Chinese steelmakers have been trimming output, cutting employees and spinning off loss-making assets as the industry has been severely hit by a cooling economy and a rising debt levels.

Shanghai-based SKS lost 1.29 billion yuan in 2014 and 97.2 million yuan in 2013, according to a statement published on the Shanghai United Assets and Equities Exchange.

The planned stake sale was reported by local media on Monday, after Baosteel announced it on the exchange on Dec. 11.

SKS has an annual capacity of 290,000 tonnes of cold-rolled stainless steel, state-owned China Securities Journal reported. Outokumpu retained a 5 percent stake in the company.

Baosteel is in the process of relocating its main operations away from Shanghai, in line with efforts to improve air quality in the Chinese financial hub.

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