On April 13, 2023, the former "Asian aluminum king" China Zhongwang was ordered to delist by the Hong Kong Stock Exchange after a year and a half of continuous suspension, and its parent company Zhongwang Group was also applied for bankruptcy reorganization by creditors. The collapse of Zhongwang, once China's largest aluminum company and the country's richest man by its founder and largest shareholder Liu Zhongtian, has become the biggest shock to the domestic aluminum industry in recent years.
Zhongwang's restructuring has been under scrutiny inside and outside the industry since its Chinese creditors filed a bankruptcy reorganization petition in September last year. In March this year, China Zhongwang said that the deadline for submitting the draft reorganization plan would be extended to June 20, but no new information has been disclosed.
The truth about US $015 billion of aluminum ingots seized by Vietnam
In the view of many creditors and "melon eaters", a key issue in the current restructuring of Zhongwang is whether Zhongwang or Liu Zhongtian has remaining assets, because Zhongwang has been operating in the aluminum industry for more than 20 years, and the business is spread at home and abroad, the identification and recovery of these remaining assets has become more complicated and confusing.
One of the most important of these assets is located in the familiar country of Vietnam.
Recently, the well-known domestic financial media Caixin published a feature article "This week's cover: The Truth about Zhongwang", which mentioned: Liu Zhongtian told Caixin reporters that he had 4 million tons of overseas aluminum ingot detained by Vietnamese customs, worth more than 60 billion yuan; There are also 5 factories and 10 warehouses overseas; In China, there are 150,000 mu of land with land certificates, 500,000 yuan per mu, and the sale is worth 75 billion yuan.
Although the authenticity of these data, after Liu Zhongtian a "SAO operation", the credibility of a big question mark, but it has more than tons of aluminum ingots detained by Vietnamese customs, it is based on evidence.
Liu Zhongtian mentioned that "the aluminum ingots detained by Vietnam customs", I believe many people have also heard that in 2019, in the anti-dumping investigation launched by the United States, involving the export of Vietnam, the value of 1.8 million tons of aluminum worth 5 billion US dollars was detained by Vietnam customs. The aluminum, which is currently being stored in a warehouse in Pati Touton province, is said to belong to Global Vietnam Aluminum Co., LTD. (hereinafter referred to as GVA). The company, which was founded in 2011 and is mainly engaged in aluminum exports, has two shareholders, Jacky Cheung (who owns 10%) and Wang Tong (who owns 90%).
Vietnamese authorities said that the so-called production capacity of 200,000 tons of the company, in the industrial zone does not have any production movement, are from China and other countries to import aluminum ingots, aluminum rods and aluminum semi-finished products in the area after the assembly, and then declare exports to the United States and many countries in the way of Vietnam's origin, in order to enjoy the difference in export tax profits through the origin. At that time, the tax rate of the United States was about 15%, and the tax rate of aluminum exported from China to the United States was as high as 374%, which was 25 times that of the former.
At the same time, Vietnam Customs also identified that from 2015 to September 30, 2019, GVA imported more than 2.44 million tons of aluminum, exported 400,000 tons, and by the time of the announcement, GVA stored more than 1.8 million tons of aluminum in outsourced warehouses and more than 200,000 tons of aluminum in factories.
In 2016, the Wall Street Journal accused GVA of being Zhongwang's aluminum export hub in Vietnam in order to remove the origin of Chinese goods before exporting to the United States to avoid anti-dumping duties, but Zhongwang denied it.
02, still in the "ant moving" transfer funds
At present, although this batch of aluminum is still under the supervision of the Vietnamese authorities, but GVA is not sitting still, still looking for ways to transfer funds. In July 2020, Vietnam's State Audit concluded that GVA showed signs of price shifting, corporate income tax evasion (CIT), and illegal transfers of funds out of the country.
According to the audit, GVA increased the rent of the warehouse of the related unit, PTL Logistics, many times in order to shift the price to at least VND 26.80 billion (about US $110 million). Between 2015 and 2019, PTL Logistics has transferred hundreds of billions of VND overseas by transferring shares and splitting profits.
Between 2016 and 2020, GVA losses totaled more than VND14.7 trillion (about $620 million). But at the same time, during the aforementioned 5-year period, PTL Logistics achieved total revenue of VND 4.23 billion (about US $178 million), after-tax profit of VND 25.62 billion, and operating gross margin fluctuated in the high range of 75-80%.
03, be "forgotten" or become "5 billion" final fate
In 2021, affected by the epidemic, the global supply of aluminum is in short supply, resulting in the price of aluminum ingots hitting a record high. Bati Dun's aluminum warehouse was once again mentioned by the international media, when the valuation was as high as $5 billion, although the impact of repeated international aluminum price fluctuations, the actual value of this batch of aluminum ingots is still very considerable.
The disposal of this 1.8 million tons of aluminum has also become the focus of much attention. For example, Vietnam has media that "seized goods over time can be confiscated into the warehouse." But experts also said that the aluminum warehouse in Bati Tau has received worldwide attention, and if you are not careful, you can destroy the image of Vietnam, and even kill Vietnam's aluminum industry.
Today, Zhongwang bankruptcy reorganization is imminent, if you can find this part of the assets, I believe that many enterprises and individuals can avoid huge losses. But for Liu Zhongtian, perhaps, these are just the "pension" he left to himself. All signs show that this batch of aluminum ingots or will be gradually forgotten in the endless investigation.
(www.profiles-aluminum.com; sales@profiles-aluminum.com).
