Del Monte Pacific expects capital deficit from write-offs of US unit's bankruptcy
Del Monte Pacific, which has a market capitalisation of about $100 million, said its net investment value in its US unit was US$579 million, as at Jan 31.
SINGAPORE - Singapore-listed canned food company Del Monte Pacific expects to record a capital deficit on its balance sheet from write-offs in relation to its US subsidiary Del Monte Foods (DMF), which last week filed for bankruptcy.
Del Monte Pacific's equity investment in DMF and certain receivables due from the US subsidiary are expected to be subject to impairment, the group said on July 7 in a response to queries from Singapore Exchange about its ability to continue as a going concern.
As at Jan 31, Del Monte Pacific's net investment value in DMF was US$579 million. In a statement last week, it also said it had US$169 million in net receivables from DMF and its subsidiaries. The company has a current market capitalisation of about $100 million.
However, the company said that the developments are not expected to disrupt its operations beyond the US, even as the extent of the impairments and other material impacts are currently being finalised and will be disclosed by Jul 31, 2025.
According to Del Monte Pacific's annual report for FY2024, DMF's sales accounted for more than 70 per cent of the group's sales.
Del Monte Pacific clarified that it has not guaranteed any loans for DMF or its subsidiaries and that it has no contingent liability with respect to their financial obligations.
The company will be stripping the US subsidiary from its consolidated accounts as it no longer controls the US unit after debtors replace majority of the latter's board.
Top stories
Swipe. Select. Stay informed.
World Trump says US nears trade deals as tariff effective date delayed
Singapore MPs should not ask questions to 'clock numbers'; focus should be improving S'poreans' lives: Seah Kian Peng
Singapore Sequencing and standards: Indranee on role of Leader of the House
Singapore NUS College draws 10,000 applications for 400 places, showing strong liberal arts interest
Life Rock band My Chemical Romance to perform in Singapore in April 2026
Singapore Life After... blazing biomedical research trail in S'pore: Renowned scientist breaks new ground at 59
Singapore More students in Singapore juggle studying and working to support their families
Life Star Awards 2025: 11 looks that shocked and charmed on the red carpet
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Straits Times
28 minutes ago
- Straits Times
25% on Japan and Malaysia, 40% on Laos: Trump's tariff letters to Asia add pressure for deals by Aug 1
Sign up now: Get ST's newsletters delivered to your inbox While the government negotiators haggle over clauses, Asia's businesses are gearing up for tough times. WASHINGTON/TAIPEI/KUALA LUMPUR - The politely-worded letters arrived in waves, laying out the consequences for Japan, South Korea, Malaysia, Indonesia, Thailand and others for failing to strike a deal in time to ward off the elevated tariffs unilaterally announced by President Donald Trump in early April and then paused until July 9. Mr Trump began with his East Asian allies, telling Japanese Prime Minister Shigeru Ishiba and South Korea's President Lee Jae-myung that their imports to the US will attract 25 per cent tariffs beginning on Aug 1. In the hours that followed, most South-east Asian nations got their mail from the White House. For Malaysia and Indonesia, both in vigorous negotiations to clinch a deal over the weekend, Mr Trump's letter specified the reciprocal tariff at 25 per cent and 32 per cent, respectively. For Thailand, the notice said 36 per cent and in the case of Laos and Myanmar, 40 per cent each. These rates are mostly in line with Mr Trump's April announcement when he shocked the region by imposing some of the highest tariffs here. Malaysia and Japan's new rates rise a little from the 24 per cent announced earlier. For Laos and Myanmar, the rates fall from 48 per cent and 44 per cent, respectively. There was no explanation offered for the change. The surprise was for Cambodia which was told its goods would incur a 36 per cent tariff, far lower than the 49 per cent tariff in Mr Trump's original announcement. Singapore, India and Taiwan, among others, have not yet heard from the White House Top stories Swipe. Select. Stay informed. Business Asia markets edge up as Trump signals still open to tariff talks World Netanyahu says he nominated Trump for Nobel Peace Prize Singapore MRT train services resume on 5-station stretch of North-South Line after track fault Multimedia 'I suspect he's cheating': She finds proof when spouses stray Opinion Singapore at 60: Home truly is an idea that never stands still Singapore Fastest charger to be added to Singapore's EV charging network by Q4 in 2025 Singapore Singapore's second mufti Sheikh Syed Isa Semait dies at age 87 The letters, identical in wording, were posted on Truth Social on July 7 afternoon, or from 12.30am on July 8 SGT. They also said that America's trading partners will face sectoral tariffs that apply on export of items like autos (25 per cent) and steel and aluminium (50 per cent) - which will hit manufacturing powerhouses like China, Japan and South Korea hard. And in line with the US policy of clamping down on goods transshipped from China to evade higher tariffs applicable on Chinese imports, there was a mention of higher tariffs on such goods. The rate was not specified however. It was also made clear that if the nations choose escalation and retaliate with tariffs of their own on US goods, Washington will respond in kind by tacking on more tariffs of equal magnitude. Although Mr Trump opened the letters with a reference to the strength of the trading relationships, he brought up his unhappiness with the large and chronic trade deficits racked up by the US. His message to the recipient nations - and to those who have yet to get their letter - was unambiguous: You have three weeks to cut a deal before the higher tariffs kick in. But his erratic negotiating style also burdens the White House with a credibility problem. Is the next milestone of Aug 1 also a moving goalpost? 'This is a rerun,' said Mr William Alan Reinsch, an expert in economics and international business at CSIS. 'Clarify the threat, extend the deadline, and hope that leads to a deal.' It is an attempt to push the nations to make more concessions since it's clear from the US point of view neither of them has made enough so far, he noted. 'The obvious question, of course, is that as August 1 approaches and there are still no deals, will Trump extend the deadline again - and perhaps increase the tariffs - or will he actually impose the tariffs.' Malaysia, hosting US Secretary of State Marco Rubio and other senior officials in the course of the Asean foreign ministers meeting this week, had repeatedly expressed confidence of negotiating a discount to the 24 per cent announced in April, especially for its most critical export sectors like electronics. 'While we acknowledge the concerns raised by the U.S. regarding trade imbalances and market access, we believe that constructive engagement and dialogue remain the best path forward,' Malaysia's Ministry of Investment, Trade and Industry said in a statement July 8. A senior Malaysian trade official told The Straits Times the silver lining is that Malaysia is 'in the same club' as Washington's allies Japan and South Korea. These three countries had likely expected a reduction in tariffs imposed on their exports from levels that were previously announced. 'We will, of course, continue to negotiate but Trump is doing this independent of (Jamieson) Greer and all the negotiations,' the same official said, requesting anonymity to comment on confidential conversations. Greer is the US Trade Representative. Higher prices and slowing economies The road to tariff agreements has been littered with false starts. Treasury Secretary Scott Bessent had said in late June that the US hoped to wrap up trade talks with them by the start of September. And in April, trade adviser Peter Navarro had suggested 90 deals would be done in 90 days. While this did not transpire, the series of letters released on July 7 announcement appear to hint at an end to the uncertainty even if the impact on trade is unwholesome. It's unfortunate that President Trump has announced 25 per cent tariff hikes for two of its closest allies, Japan and South Korea, said former US trade negotiator Wendy Cutler. 'Both have been close partners on economic security matters and have a lot to offer the US on priority matters like shipbuilding, semiconductors, critical minerals and energy cooperation,' said Ms Cutler who is now vice-president at the Asia Society Policy Institute (ASPI). Companies from both countries have made significant manufacturing investments in the US in recent years and provided high-paying jobs to US workers, she added. And both are key markets for a variety of US goods from pork to planes. Mr Reinsch said there was no good news to be had from the tariffs. 'A 25 per cent tariff will have a major impact on Korean and Japanese exports to the US, including things that are in demand here like autos and semiconductors.' 'They will mean higher prices here and a slowdown in the economies of the other two countries,' Mr Reinsch said. The ongoing Section 232 investigations that may lead to additional tariffs on autos and semiconductors are another worry, he said. The July 7 announcement sends a chilling message to others, Ms Cutler said. It suggests that the US will not be open to reprieves from the Section 232 sectoral tariffs, including on autos, a high priority for both Japan and South Korea. But she also saw a less glum side. 'While the news is disappointing, it does not mean the game is over,' said Ms Cutler. 'We cannot rule out a breakthrough in negotiations in the lead up to Aug 1, when the additional tariff hikes are to take effect,' she said. Waiting in the wings Some excitement surrounds the possibility of a' mini' trade deal with India. Negotiations are believed to be centred around India opening up certain segments of the agriculture and dairy sector while seeking lower than 26 per cent tariffs for the textile and footwear sectors among others. India is also seeking concessions on auto parts apart from reduced tariffs on aluminium and steel. India is unwilling to concede to the US demand for exports of genetically modified crops like corn. Any concessions seen as unreasonable by its strong farm lobby would have a direct political impact on the Narendra Modi government. Sources said India has the July 2 deal struck by Vietnam in mind as they seek an accommodation with Mr Trump. India and Vietnam are competitors in areas like electronics and textiles. 'It's no longer just about tariffs anymore, it's about comparative tariffs since Vietnam has 20 per cent,' said an industry insider. The US-Vietnam deal will see American goods enter Vietnam duty-free while the US charges 20 per cent tariffs on Vietnamese goods instead of the 46 per cent tariffs announced by Mr Trump in April. Goods made in other nations, such as China, that are trans-shipped from Vietnam will be charged a higher tariff of 40 per cent, addressing an issue that has long rankled with the US. The countries' negotiators are, however, still in talks to finalise the details of the deal. China, which had been hit by a different set of tariffs springing from on its role in the fentanyl smuggling and alleged unfair trade practices, also reached a trade truce with the US in late June. However, the details are under wraps and Washington has already complained of slow progress in China's promise to resume tech industry's demand for rare earth-related exports to the US. Stressful times ahead While the government negotiators haggle over clauses, Asia's businesses are gearing up for tough times. The tariffs are expected to slow economic growth, increase consumer prices, trigger job losses, and trigger market volatility in the region. Mr Bai Tsan-jung, chairman of Sun Jen Textile Company in Taiwan, has not slept well since the US announced in April that it would slap a hefty 32 per cent tariff on goods from the island. Should Taipei fail to negotiate a deal with Washington by July 9, around half of Mr Bai's 110-member workforce may have to be furloughed or forced into early retirement. 'This has been the most stressful and challenging period for my company in our 40-year history – this is worse than Covid or Sars,' he told The Straits Times. His business had already seen sales dwindle for some years as customers have turned to China for cheaper materials, but he said that it has survived because of the high quality of the textiles his firm produces. 'But a steep US tax on our goods could be the final blow for us,' he added. Mr Bai's company, which produces nylon and other yarn, does not export directly to the US, but its main customers – garment factories in Taiwan, Indonesia and Vietnam – do. 'US tariffs do not affect only the companies that sell directly to the US – everyone in the supply chain is impacted,' he said. 'If those factories suffer because of tariffs, they won't take orders from my company either.' There is a similar sense of uncertainty over at TopTowel, an original equipment manufacturer of towels for sportswear and lifestyle brands. The US accounts for around 18 per cent of the firm's exports. Mr Bruce Chang, the company's sales manager, said that the firm has been trying to secure orders in more countries. He told ST over the telephone: 'I'm currently in Japan, meeting with potential partners and clients. The huge uncertainty over the US tariffs means that we need to look at opening up new markets, such as Australia and Europe.' Taipei, whose economy is heavily reliant on exports, has scrambled to reach compromise and to show Washington that it takes trade rules seriously as the spectre of hefty US tariffs looms. The island has repeatedly vowed to ensure that it does not become a place for Chinese exporters to dodge US tariffs with fake 'Made in Taiwan' labels. It has also pledged to buy more American goods, including US natural gas, to help narrow the trade deficit. In Kuala Lumpur, analysts believe that a negative impact on the domestic economy is the cards, irrespective of whatever deal is struck. There are growing expectations that Malaysia's central bank will cut interest rates by 25 basis points to 2.75 per cent at its next policy meeting, coincidentally falling on July 9. 'We expect the cut to materialise largely as a means of preempting a potential slowdown in domestic demand,' said a June 25 HSBC report. Additional reporting by Nirmala Ganapathy in New Delhi, Walter Sim in Tokyo, Wahyudi Soeriaatmadja in Jakarta and Philip Wen in Bangkok
AsiaOne
35 minutes ago
- AsiaOne
Lula tells Trump world does not want 'emperor' after US threatens Brics tariff, World News
RIO DE JANEIRO — Developing nations at the Brics summit on Monday (July 7) brushed away an accusation from President Donald Trump that they are "anti-American," with Brazil's president saying the world does not need an emperor after the US leader threatened extra tariffs on the bloc. Trump's threat on Sunday night came as the US government prepared to finalise dozens of trade deals with a range of countries before his July 9 deadline for the imposition of significant "retaliatory tariffs." The Trump administration does not intend to immediately impose an additional 10 per cent tariff against Brics nations, as threatened, but will proceed if individual countries take policies his administration deems "anti-American," according to a source familiar with the matter. At the end of the Brics summit in Rio de Janeiro, Lula was defiant when asked by journalists about Trump's tariff threat: "The world has changed. We don't want an emperor." "This is a set of countries that wants to find another way of organising the world from the economic perspective," he said of the bloc. "I think that's why the Brics are making people uncomfortable." In February, Trump warned the Brics would face "100 per cent tariffs" if they tried to undermine the role of the US dollar in global trade. Brazil's Brics presidency had already backed off efforts to advance a common currency for the group that some members proposed last year. But Lula repeated on Monday his view that global trade needs alternatives to the US dollar. "The world needs to find a way that our trade relations don't have to pass through the dollar," Lula told journalists at the end of the Brics summit in Rio de Janeiro. "Obviously, we have to be responsible about doing that carefully. Our central banks have to discuss it with central banks from other countries," he added. "That's something that happens gradually until it's consolidated." Other Brics members also pushed back against Trump's threats more subtly. South African President Cyril Ramaphosa told reporters that the group does not seek to compete with any other power and expressed confidence in reaching a trade deal with the US "Tariffs should not be used as a tool for coercion and pressuring," Mao Ning, the Chinese foreign ministry spokesperson said in Beijing. The Brics advocates for "win-win co-operation," she added, and "does not target any country." A Kremlin spokesperson said Russia's co-operation with the Brics was based on a "common world view" and "will never be directed against third countries." India did not immediately provide an official response to Trump. Many Brics members and many of the group's partner nations are highly dependant on trade with the United States. New member Indonesia's senior economic minister, Airlangga Hartarto, who is in Brazil for the Brics summit, is scheduled to go to the US on Monday to oversee tariff talks, an official told Reuters. Malaysia, which was attending as a partner country and was slapped with 24 per cent tariffs that were later suspended, said that it maintains independent economic policies and is not focused on ideological alignment. Multilateral diplomacy With forums such as the G7 and G20 groups of major economies hamstrung by divisions and Trump's disruptive "America First" approach, the Brics group has presented itself as a haven for multilateral diplomacy amid violent conflicts and trade wars. [[nid:719963]] In a joint statement released on Sunday afternoon, leaders at the summit condemned the recent bombing of member nation Iran and warned that the rise in tariffs threatened global trade, continuing its veiled criticism of Trump's tariff policies. Hours later, Trump warned he would punish countries seeking to join the group. The original Brics group gathered leaders from Brazil, Russia, India and China at its first summit in 2009. The bloc later added South Africa and last year included Egypt, Ethiopia, Indonesia, Iran, and the United Arab Emirates as members. Saudi Arabia has held off formally accepting an invitation to full membership, but is participating as a partner country. More than 30 nations have expressed interest in participating in the Brics, either as full members or partners. [[nid:719915]]
Business Times
36 minutes ago
- Business Times
Gold steady after Trump unveils steeper tariffs, Treasury yields weigh
[BENGALURU] Gold prices steadied on Tuesday (Jul 8) as US President Donald Trump announced sharply higher tariffs on goods from Japan, South Korea and other nations, while higher US treasury yields capped gains. Spot gold fell 0.1 per cent to US$3,331.89 per ounce as at 0035 GMT. US gold futures were steady at US$3,341.80. On Monday, Trump began telling trade partners, including Japan and South Korea, that sharply higher US tariffs would start on Aug 1, marking a new phase in the trade war he launched earlier this year. The Aug 1 effective date for US tariffs was firm, Trump emphasised but added he was open to extensions if countries made proposals. 'Reciprocal tariffs' were capped at 10 per cent until Jul 9 to allow for negotiations, but only agreements with Britain and Vietnam have been reached so far. The yield on benchmark US 10-year notes hovered near a two-week high, while the US dollar index shed 0.1 per cent. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up A higher yield increases the opportunity cost of holding non-yielding bullion, while a weaker US dollar makes it more affordable for holders of other currencies. The Trump administration will not immediately impose a new 10 per cent tariff against members of the developing nation Brics bloc but will proceed if countries take so-called 'anti-American' policy actions, according to a source familiar with the matter. Trump's tariff policies have stoked inflation fears, further complicating the Federal Reserve's path to lower interest rates. The minutes of its June meeting, expected on Wednesday, should offer more clues into its policy outlook. A paper published jointly by the San Francisco and New York Federal Reserve banks suggests the possibility of the Fed cutting its short-term rate target to near-zero levels in the coming years despite current relatively high borrowing costs. Spot silver lost 0.5 per cent to US$36.74 per ounce, platinum shed 1.5 per cent to US$1,370.46 and palladium fell 2.1 per cent to US$1,170.46. REUTERS
