Hisense Kelon Electrical Holdings Co, a Chinese home-appliance maker set to form a venture with Whirlpool Corp, said it suspended a plan to issue shares and acquire assets from its controlling shareholder.
Sales and future earnings are uncertain as the operating environment for home appliances has "rapidly deteriorated," a result of worsening global financial risks, the Guangdong-based company said in a statement to the Shenzhen Stock Exchange.
Hisense Kelon said in May it planned to issue US$230 million of shares to controlling shareholder Qingdao Hisense Air Conditioner Co in return for stakes in four companies, including an air-conditioner unit in Shandong Province, Bloomberg News reported.
"Energy and raw material costs have sharply risen and the domestic economic outlook appears severe," the company said.
"The planned asset sales can no longer proceed as original conditions have changed significantly."
Qingdao Hisense will still try to inject assets into Hisense Kelon "at an appropriate time in the future," the unit said.
Hisense Kelon's A shares will resume trading today, according to the statement.
It didn't say when trading in the Hong Kong-listed shares, suspended since June 2005, will resume.
(Shanghai Daily July 21, 2008)
