China Metallurgical Group Corporation (MCC) confirmed Wednesday it has suffered a huge loss on an investment in metal processing subsidiary MCC Hengtong Cold Rolling Technology Co.

MCC faces huge loss, layoffs

中冶恒通面临亏损和裁员

China Metallurgical Group Corporation (MCC), a Chinese state-owned conglomerate, confirmed Wednesday it has suffered a huge loss on an investment in metal processing subsidiary MCC Hengtong Cold Rolling Technology Co.

Media reports Thursday estimated the loss could be as high as 4.6 billion yuan.

For company insiders, the massive losses at the Tangshan-based firm have been an open secret for some time. "Hengtong loses about a billion yuan every year," an anonymous company insider told the National Business Daily Wednesday. "The amount has gotten bigger every year. Now, the company is already underwater."

Kang Chengye, a board member at MCC Ltd., the conglomerate's listed subsidiary (601618.SH，01618.HK), said the loss will have no substantial influence on the listed firm. According to the company's prospectus, MCC Hengtong took losses of 560 million yuan in 2008 and 490 million yuan in the first six months of 2009.

The National Business Daily reported Friday that MCC Hengtong started laying off staff in late June. Nearly 3,000 of the firm's 4,237 employees have agreed to take buyout offers to leave the firm. Employees who resign will receive about 3,000 yuan in extra compensation. The rest will be sacked in batches with a one-time severance payment. The first wave of layoffs is expected to cut 600 employees.

Numerous employees with the company told the National Business Daily Tangshan-based steel maker Tangsteel, part of China's largest steel manufacturer, has shown interest in acquiring Hengtong. MCC spokesman Shao Bo said the details of that deal are still under negotiation.

中国大型企业中冶集团已于星期三在其官网上确认，因投资其金属处理子公司中冶恒通冷轧技术有限公司而遭受巨额亏损。

根据媒体星期四的报道，亏损金额高达46亿元。

在多位中冶恒通内部人士眼里，公司出现巨亏已是公开的秘密。“中冶恒通每年亏损额大概近10亿元，开始亏得少，后来则是年年巨亏，现在公司已经是负资产。”一位不愿具名的中冶恒通内部人士称。

中国中冶（601618.SH，01618.HK）董秘康承业在近日对媒体的书面回应中表示，亏损对集团上市公司并无实质性影响。但据中国中冶招股说明书披露，中冶恒通已在2008年亏损5.6亿元，2009年上半年亏损4.9亿元。

根据每日经济新闻星期五的报道，由于中冶恒通生产经营发生严重困难，中冶恒通的裁员工作已在今年6月下旬启动，经过公司多次动员、劝退后，在职注册职工4237人中已签“退厂协议”的近3000人，这些主动辞职的人可以多获得3000元补偿。而未签退厂协议的，则分批次按经济性裁员处理，其中首批经济性裁员600人。

一些中冶恒通的员工向《每日经济新闻》记者反映称，河北钢铁集团旗下唐钢有意接手。中冶集团新闻发言人邵波则在接受媒体采访时表示，现在能确定唐钢有这个意向，但具体情况还正在谈。