Bailout ideal for Citic Pacific, less so for shareholders
Citic Group agrees to buy FX "hedges" with mark-to-market losses of HK$10.4 billion from its Hong Kong-listed unit in exchange for an interest equity stake.
The management at Citic Pacific is no doubt breathing a sigh of relief after being thrown a lifeline by its controlling shareholder, state-owned Chinese investment company Citic Group. Having shocked shareholders a few weeks back with the revelation that contracts entered into by its finance chief to hedge an exposure to the Australian dollar had turned sour and cost the company close to $2 billion in losses, Citic Pacific has struck an agreement to sell the majority of the ôtoxicö...
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