Shareholders Lose with Citic Pacific Bailout
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 "toxic" contracts to Citic Group, effectively eliminating any further losses from this exposure.
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