Sep 21, 2018 (China Knowledge) - China Merchants Group is considering the sale of a majority stake in pallet-maker Loscam to Asian buyout firms expressing interest in the deal. Any deal could value Loscam at USD 1 billion.
Loscam, which is based in Australia, manufactures wood and plastic pallets which are used in the transport of goods. It also produces cages for high-value freight, as well as fresh produce crates and bulk containers. The company has operations in Australia, New Zealand, China and Southeast-Asian nations.
China Merchants Group which runs businesses that includes ports, toll roads, shipping and financial services acquired Loscam in 2010 for USD 650 million.
The potential sale comes amid rising trade tensions between U.S. and China, with China hitting back with tariffs on USD 60 billion worth of U.S. goods after the U.S. imposed tariffs on USD 200 billion Chinese imports. Less trade could decrease demand for pallets and the China Merchants Group is looking to strike a deal quickly.
China Merchants Group held RMB 7.3 trillion (USD 1.07 trillion) worth of assets at the end of last year with profits rising by 14% to RMB 127.7 billion (USD 16.8 billion) in the same year.
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