CITIC Pacific says in talks about equity issue

HONG KONG, Nov 3 (Reuters) - Beijing-backed conglomerate CITIC Pacific (0267.HK) said on Monday it is in talks with its state-owned parent about a possible equity issue.

The steel-to-property conglomerate said it is discussing details of a previously announced $1.5 billion loan facility with its parent, state-run CITIC group, adding that any agreement may involve an equity issue.

CITIC Pacific, which shocked the market last month by warning of a potential $2 billion loss on foreign exchange trading, did not say what such an equity issue might involve, nor give any other details.

The company added that trading in its shares will remain suspended pending details of the loan.

Monday's statement followed newspaper reports that the CITIC Group would inject cash or assets into CITIC Pacific in exchange for a 10 percent stake in the Hong Kong-listed unit, aiming to boost its capital base.

Headed by tycoon Larry Yung, who once topped the Forbes magazine list of mainland China's richest people, CITIC Pacific said in October its Beijing parent would help arrange a $1.5 billion loan facility for the company.

Its potentially massive forex losses have caught the attention of regulators. The China Securities Regulatory Commission and Hong Kong's Securities and Futures Commission were investigating the CITIC Pacific case, and results of that probe would be released soon, the China Business News quoted a senior official of the CITIC Group as saying last week.

CITIC Pacific, which owns 17.5 percent of dominant Hong Kong airline Cathay Pacific Airways (0293.HK), would not comment on newspaper reports.

Its stock jumped 21 percent on Friday morning before being suspended. But it lost nearly 60 percent of its market value in the past two weeks after the foreign exchange trading loss was reported. (Reporting by Alison Leung; Editing by Erica Billingham)