Aluminium firm Zhongwang seeks legal advice after US charges

In this May 8, 2009 file photo, Liu Zhongtian, the Chinese billionaire chairman of the China Zhongwang Holdings Limited, celebrates at the company's listing ceremony in the Hong Kong Stock Exchange. (AP)
Updated 05 August 2019

Aluminium firm Zhongwang seeks legal advice after US charges

  • In its statement, Zhongwang said its board believed the legal proceedings had so far had no material adverse impact on the company’s operations or its financial condition

BEIJING: China Zhongwang Holdings said on Sunday it was seeking legal advice after the company and its controlling shareholder, Liu Zhongtian, were indicted on charges they evaded $1.8 billion of tariffs by smuggling aluminum into the US.
Zhongwang said in a statement to the Hong Kong Stock Exchange that it and Liu had still not been served with any notice in relation to the legal proceedings.
“The company takes seriously any allegations that it may have violated any law, and is seeking legal advice in relation to the alleged proceeding,” it said in the statement, adding it would keep shareholders informed of further developments.
Zhongwang is based in northeast China’s Liaoning province and makes aluminum products for the automotive and construction industries.
US prosecutors have alleged that companies affiliated with Liu used ports in the Los Angeles area to import aluminum from China that was disguised as a finished product not subject to duties, before making bogus sales.

FASTFACT

• Zhongwang says operations, finances not impacted.

• Firm could face monetary penalties.

• Company and founder Liu Zhongtian indicted in US.

• Zhongwang makes aluminum products for the automotive and construction industries.

Zhongwang has previously described smuggling allegations as “misleading” and “without any factual basis.”
Liu stepped down as Zhongwang chairman in 2017 but remains its largest shareholder with a 74.16 percent stake, according to Refinitiv Eikon data.
“If the allegations were proven in court, the company could face monetary penalties,” Zhongwang said in the statement.
Zhongwang’s share price fell by 14.2 percent on Thursday, after the indictment was reported, and fell a further 7.6 percent on Friday to end the week on HK$3.18 ($0.4062), its lowest close since October 2015.
In its statement, Zhongwang said its board believed the legal proceedings had so far had no material adverse impact on the company’s operations or its financial condition.
“The company continues to operate as normal,” it said, adding that a further announcement would be published if the situation changes.


Chile’s LATAM Airlines files for US Chapter 11 bankruptcy protection

Updated 26 May 2020

Chile’s LATAM Airlines files for US Chapter 11 bankruptcy protection

  • The company is the largest airline in Latin America
  • LATAM said they have about $1.3 billion in cash on hand

LATAM Airlines Group SA said on Tuesday the company and its affiliates in Chile, Peru, Colombia, Ecuador and US have filed for Chapter 11 bankruptcy protection in the United States, due to a slump in travel worldwide amid the coronavirus crisis.
Latin America’s largest airline said it secured funding from shareholders, including two of its largest the Cueto and Amaro families, and Qatar Airways, to provide up to $900 million in debtor-in-possession financing.
The company said it had about $1.3 billion in cash on hand.
“We have implemented a series of difficult measures to mitigate the impact of this unprecedented industry disruption, but ultimately this path represents the best option,” Chief Executive Officer Roberto Alvo said.
LATAM Airlines Group listed assets and liabilities in the range of $10 billion and $50 billion, according to a filing with the US Bankruptcy Court in Southern District of New York.
The airlines and its affiliates will continue to fly with no impact on passenger or cargo operations and reservations, the company said.
The company said its affiliates in Argentina, Brazil and Paraguay were not included in the Chapter 11 filing.
LATAM Airlines’ Brazilian affiliates are in discussions with the Brazilian government about the next steps and financial support for operations in the country.