A Chinese mining company defaulted on its bonds, the latest firm to have trouble with financing as an economic slump hurts business.
Zibo Hongda Mining Co (宏達礦業公司), which is based in Shandong Province, said it did not raise enough funds to make its full debt payment due on Tuesday, according to a statement posted to the Shanghai Clearing House Web site.
The iron ore miner issued 400 million yuan (US$61 million) of notes last year with a coupon rate of 8 percent and had to repay 431.91 million yuan in principal and interest on Tuesday.
Chinese mining companies are struggling as Chinese President Xi Jinping (習近平) pushes to reduce pollution and cut industrial overcapacity amid the worst economic slowdown in a quarter century.
MOVE BY BANKS
Some banks have withdrawn loans to Zibo Hongda, increasing the company’s liquidity shortage, according to a statement from Dagong Global Credit Rating Co on Tuesday last week posted on the Chinamoney Web site.
“Demand from the company’s customers, mainly steel firms, has been falling as they struggle due to overcapacity,” said Ji Weijie (季偉傑), a bond analyst at China Securities Co (中信建設證券) in Beijing.
“Industries with overcapacity problems have very high credit risks, especially those companies not backed by the government,” Ji said.
CUTTING CAPACITY
China will close between 100 million and 150 million tonnes of annual crude steel capacity by 2020, according to an outline published on the Web site of the State Council on Feb. 4.
That is as much as 13 percent of existing capacity estimated by the China Iron & Steel Association in January at 1.2 billion tonnes.
At least 10 companies have reneged on bond obligations in the past two years even as the government loosened monetary policy and allowed more companies to sell notes in the onshore market.
Zibo Hongda said it would try to raise money through multiple channels to repay the debt, according to its statement.
Two telephone calls to the firm’s main number went unanswered yesterday.
purpose: Tesla’s CEO sought to meet senior Chinese officials to discuss the rollout of its ‘full self-driving’ software in China and approval to transfer data they had collected Tesla Inc CEO Elon Musk arrived in Beijing yesterday on an unannounced visit, where he is expected to meet senior officials to discuss the rollout of "full self-driving" (FSD) software and permission to transfer data overseas, according to a person with knowledge of the matter. Chinese state media reported that he met Premier Li Qiang (李強) in Beijing, during which Li told Musk that Tesla's development in China could be regarded as a successful example of US-China economic and trade cooperation. Musk confirmed his meeting with the premier yesterday with a post on social media platform X. "Honored to meet with Premier Li
Dutch brewing company Heineken NV on Friday announced an investment of NT$13.5 billion (US$414.62 million) over the next five years in Taiwan. The first multinational brewing company to operate in Taiwan, Heineken made the statement at a ceremony held at its brewery in Pingtung County. It also outlined its efforts to make the brewery “net zero” by 2030. Heineken has been in the Taiwanese market for 20 years, Heineken Taiwan managing director Jeff Wu (吳建甫) said. With strong support from local consumers, the Dutch brewery decided to transition from sales to manufacturing in the country, Wu said. Heineken assumed majority ownership and management rights
ARTIFICIAL INTELLIGENCE: The chipmaker last month raised its capital spending by 28 percent for this year to NT$32 billion from a previous estimate of NT$25 billion Contract chipmaker Powerchip Semiconductor Manufacturing Corp (力積電子) yesterday launched a new 12-inch fab, tapping into advanced chip-on-wafer-on-substrate (CoWoS) packaging technology to support rising demand for artificial intelligence (AI) devices. Powerchip is to offer interposers, one of three parts in CoWoS packaging technology, with shipments scheduled for the second half of this year, Powerchip chairman Frank Huang (黃崇仁) told reporters on the sidelines of a fab inauguration ceremony in the Tongluo Science Park (銅鑼科學園區) in Miaoli County yesterday. “We are working with customers to supply CoWoS-related business, utilizing part of this new fab’s capacity,” Huang said, adding that Powerchip intended to bridge
Microsoft Corp yesterday said that it would create Thailand’s first data center region to boost cloud and artificial intelligence (AI) infrastructure, promising AI training to more than 100,000 people to develop tech. Bangkok is a key economic player in Southeast Asia, but it has lagged behind Indonesia and Singapore when it comes to the tech industry. Thailand has an “incredible opportunity to build a digital-first, AI-powered future,” Microsoft chairman and chief executive officer Satya Nadella said at an event in Bangkok. Data center regions are physical locations that store computing infrastructure, allowing secure and reliable access to cloud platforms. The global embrace of AI