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China Fibretech suspends share trading after unit receives damage claims
CHINA Fibretech on Monday suspended the trading of its shares, after its subsidiary, Shishi Simwa Knitting & Dyeing Co, Ltd, received damage claims from three customers last week.
The customers claimed to have suffered "substantial damages and financial losses'' as a result of Shishi's products not meeting their specified requirements, causing decolourisation of their end-products.
The claims were only brought to the attention of the management recently for products delivered in 2014 and early 2015.
"The management will be visiting the customers to establish the facts surrounding their allegations and take steps to verify their claims. Currently, there is still great uncertainty in relation to the validity of these claims, the quantum thereof and the impact that these might have on the Company,'' China Fibretech executive chairman and CEO, Wu Xinhua, said.
Mr Wu added that management would report to the board of directors on the status and development of the claims and would not admit liability nor agree to any form of compensation before consulting and seeking the board's approval.
China Fibretech said due to the uncertainties surrounding these claims, trading of its shares would be suspended until further notice to ensure a fair, orderly and transparent market.