The takeover of near-bankrupt Swissmetal, a copper alloy manufacturer, is being blocked by the China Development Bank.
As the main creditor of Baoshida Swissmetal (taken over by Chinese firm Baoshida in 2013) the Chinese Development Bank (CDB) has refused an offer of CHF9 million by Swiss Team for the company. The deadline for the debt restructuring is May 22.
Around 160 employees at the company’s two sites in northwestern Switzerland could lose their jobs if the firm goes bankrupt.
"I call on the Chinese ambassador to Switzerland to reason with the CBD," André Rezzonico, Chairman of the Board of Directors of Swiss Team, said on Friday. "Switzerland and China have an opportunity to demonstrate the quality of their relations".
The former Chinese CEO of Baoshida Swissmetal had contracted a loan of €15 million (CHF17 million) from CBD. However, the sole administrator is suspected by the Swiss courts of unfair management. The Chinese bank wants to claim back the funds.
As part of a creditors' consultation, the commissioner for debt-restructuring had proposed a partial repayment of the debt by the buyer to allow the takeover. The CDB refused and wanted Swiss Team to assume all bank debt, something that the potential buyer refuses.
Despite this uncertainty, the plant, which had experienced serious strikes at its Reconvilier site in 2004 and 2006, continues to operate. "The first quarter results are positive," said Baoshida Swissmetal director Claudio Penna, adding that the company had finished 2018 at break-even.
If the transaction is successful, the new owner undertakes to take over all the staff and invest in new machinery.