Chinese mining firm to undergo liquidation
Chinese mining firm to undergo liquidation
<![CDATA[
Unable to
repay bondholders, Chinese state-owned enterprise (SOE) Guangxi Non-Ferrous
Metals Group has been given the go-ahead by Chinese regulators to cease
operating and to liquidate its assets.
Liquidation
is a rare occurrence for SOEs, but according to an online report from Beijing-based Caixin Media, a court in the city of Nanning, China, has
approved the provincial SOE’s request to liquidate.
Guangxi
Non-Ferrous reportedly owes some RMB14.5 billion ($2.2 billion) to more than
100 creditors and bondholders. Caixin Media says it is the first SOE known to
have failed “after defaulting in the highly liquid interbank bond market” in
China. Among its creditors are the China Development Bank and the Minmetals
International Trust, says Caixin.
The company
has been acknowledging financial and debt payment problems since mid-2015,
according to the report. The SOE was founded only seven years earlier, in 2008,
to explore for and mine minerals that produce nonferrous metals such as lead,
tin, zine, antimony and manganese.
Among the
conditions that led to Guangxi Non-Ferrous Group’s demise, according to a
source quoted within the Caixin report, was the global glut of nonferrous
metals and their declining values.
The company,
based in the city of Nanning, initially focused on exploration and mining
within China, but in 2012 formed a subsidiary called Guangxi Non-Ferrous
International Investment that initially invested in a project in Cambodia and
had as its goal to “radiate to Australia, Canada, South America, South Africa
and other countries and region with abundant mineral resources.”
According to
Guangxi International’s website, the firm subsequently invested in mining and minerals processing projects in
Peru and South Africa, as well as the one in Cambodia.
The potential
liquidation of SOEs in China is of great interest to steelmakers and nonferrous
metals producers around the world. The number of “zombie companies” accused of contributing to global steel and aluminium overcapacity is
calculated by some to be in the hundreds.
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Source: Recycling Today
Chinese mining firm to undergo liquidation
<![CDATA[Unable to repay bondholders, Chinese state-owned enterprise (SOE) Guangxi Non-Ferrous Metals Group has been given the go-ahead by Chinese regulators to cease operating and to liquidate its assets. Liquidation is a rare occurrence for SOEs, but according to an online report from Beijing-based Caixin Media, a court in the city of Nanning, China, has approved the provincial SOE’s request to liquidate. Guangxi Non-Ferrous reportedly owes some RMB14.5 billion ($2.2 billion) to more than 100 creditors and bondholders. Caixin Media says it is the first SOE known to have failed “after defaulting in the highly liquid interbank bond market” in China. Among its creditors are the China Development Bank and the Minmetals International Trust, says Caixin. The company has been acknowledging financial and debt payment problems since mid-2015, according to the report. The SOE was founded only seven years earlier, in 2008, to explore for and mine minerals that produce nonferrous metals such as lead, tin, zine, antimony and manganese. Among the conditions that led to Guangxi Non-Ferrous Group’s demise, according to a source quoted within the Caixin report, was the global glut of nonferrous metals and their declining values. The company, based in the city of…