Cash-strapped Chinese copper trader Maike in talks to sell assets

BEIJING (Reuters) – Maike Group, one of China’s top copper traders, is in talks with state-owned companies to sell some assets after it faced difficulties paying some of its suppliers, its chairman told Reuters on Thursday.

The company, which says it imports more than 1 million tonnes of refined copper a year, has said COVID-related lockdowns in the cities of Shanghai and Xi’an earlier this year hurt its liquidity.

The lockdowns disrupted logistics and the delivery of financial documents and bank operations, leading to delayed shipments and payment uncertainty, it said.

Miners including BHP and Codelco have paused their sales to Maike as a result of its cash issues, Bloomberg reported last week.

Codelco declined to comment when reached out by Reuters on Thursday. BHP did not immediately respond to a request for comment.

Maike Group has 15 billion yuan ($2.17 billion) worth of fixed assets and 3 billion yuan in long-term equity investments abroad, which could be sold to facilitate its liquidity, He Jinbi, founder and chairman, told Reuters.

He declined to name the companies involved in the talks as discussions are still ongoing.

Maike has also received credit support from banks and financial institutions, including the extension and or rollover of existing loans, He said, adding that local government has also provided tax rebates and other support.

The company is also in talks with overseas suppliers for new business relationships, He said.

China, the world’s biggest copper consumer, imported 3.44 million tonnes of refined copper last year, worth $32.2 billion.

($1 = 6.8975 Chinese yuan renminbi)

(Reporting by Siyi Liu, Dominique Patton, Additional reporting by Beijing Newsroom, Fabian Cambero in Santiago and Clara Denina in London; Editing by Susan Fenton)

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