Citic Pacific, a state-backed conglomerate, has no imminent plan to sell its assets to shore up its finances after incurring more than HK$16.8 billion of paper loss on its soured foreign currency bets, according to Chang Zhenming, deputy chairman of its parent, Citic Group.
Mr Chang's remarks came despite Citic Pacific saying last month that it was in initial talks to sell all or part of its 56.67 per cent stake in listed trading arm Dah Chong Hong Holdings.
Mr Chang, who heads a special committee formed to clean up the financial mess, was quoted by Caijing magazine as saying: 'Our stance is very clear, we will not sell any of Citic Pacific's assets at this moment. I believe Citic Pacific is still a good company despite the current crisis.'
Citic Pacific's stake in Dah Chong Hong is worth HK$1.02 billion, based on last Friday's closing share price of HK$1.
Citic Pacific said last month it raked up huge losses after entering into certain complex foreign currency trades, most of which were on the Australian dollar, which depreciated about 33 per cent against the greenback after reaching a record high in July.
Last week, Citic Group said it would assume two-thirds of Citic Pacific's A$9.1 billion (HK$46.12 billion) Australian dollar derivative contracts in exchange for HK$9.3 billion.
As a result, Citic Pacific's Australian dollar exposure will be reduced to about A$3 billion, which it said would be sufficient to meet its normal investment needs for its iron ore mining projects in Australia.