BEIJING (Reuters) - China Hongqiao Group (1378.HK), the world’s biggest aluminium producer, said it has signed a financing agreement with Industrial Bank Co Ltd (601166.SS) worth 30 billion yuan (3.51 billion pounds) as it looks to upgrade its manufacturing facilities.
Industrial Bank will provide Hongqiao and its affiliates with services including supply-chain financing, debt instruments, industrial funds and asset-backed securitisation to help it raise money, according to a statement on Hongqiao’s official Wechat account late on Tuesday.
Hongqiao, based in Binzhou in eastern China’s Shandong province, aimed to create a “world-renowned” production base for lightweight automobile parts and other high-end uses of aluminium, Chairman Zhang Shiping said.
The company, which had to shut 2.68 million tonnes of illegal smelting capacity in Binzhou last year, has turned to debt markets in recent months after its 2017 earnings took a big hit from a 3.37 billion yuan impairment charge, despite higher aluminium prices. [nL4N1KU33N] [nL4N1N21FA]
Hongqiao said in April it was issuing $450 million of bonds to refinance debt and for general corporate purposes.
Reporting by Tom Daly; editing by Richard Pullin