(Aug 17): A unit of China’s state-backed SDIC Commodities Co was ordered to liquidate by a Hong Kong court, adding to the financial troubles for the metals trader as Beijing increases scrutiny on the sector.
During the hearing on Monday, lawyers for the liquidation petitioner, Nanyang Commercial Bank Ltd, asked for an immediate wind-up order for the unit, Commodities Hongkong Co. The company argued for an adjournment and said that Nanyang Commercial had made a sudden request for an immediate payment of more than one billion yuan (US$148 million or RM605 million). But it added that it couldn’t give a timeline for such a payment.
The judge said that the debt wasn’t in dispute and so there was no reason to delay the winding-up decision.
The liquidation order for the unit is the latest challenge for beleaguered SDIC. The state-owned firm was earlier identified as one of the highest-profile participants in a metals trading network linked to Xu Maohua, whose unfinished deals left Chinese traders facing losses of at least one billion yuan.
SDIC Commodities’ debt troubles emerged late last year when Guangdong Prolto Supply Chain Management Co, a Shenzhen-based trader, filed a 219 million yuan lawsuit against the company over allegedly unpaid copper concentrate shipments.
