It Cost to Be the Boss; Costco (NASDAQ: COST), pushes for price cuts from Chinese suppliers
Costco (NASDAQ: COST), the US warehouse retailer, is urging its suppliers in mainland China to lower prices in response to US tariffs, according to a report in the Financial Times. This move increases the likelihood of attracting attention from Beijing as the trade war escalates. Walmart (NYSE: WMT) and a few other leading retailers have also made similar requests, according to statements from suppliers and exporters.
The Trump administration imposed an extra 10% tariff on Chinese goods in February 2024, which was later increased to 20% this month. This has led US companies, including Costco, which heavily relies on imports from China, to find ways to lessen the effects on their profits.
The situation is becoming increasingly sensitive in mainland China where many suppliers, already dealing with years of tariffs and operating on slim profit margins, are preparing for the possibility of more levies.
Walmart was called in by China’s Ministry of Commerce last week to discuss the retailer’s requests. The company, which also relies heavily on Chinese imports, has expanded in mainland China under its popular Sam’s Club membership model, with a presence in over 100 cities.
Since 2019, Costco has opened seven warehouses in mainland China. However, one supplier noted that the company would tread carefully, given the recent meeting between Walmart and China’s Ministry of Commerce.
Meanwhile, Walmart stated that it sources products from 70 countries worldwide, contributing to job creation, supplier development, and local economies.
He Yongqian, a spokesperson for China’s Ministry of Commerce, confirmed last week that the meeting with Walmart was prompted by media reports and feedback from companies. He noted that Walmart had clarified the situation, and that the discussion was not a reprimand.
China’s state media has been framing the situation along national lines, arguing that China should not be blamed for US tariffs.
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enCore Energy (NASDAQ:EU) to Sell New Mexico Assets; Plans to Distribute Consideration Shares to enCore Shareholders
enCore Energy Corp. (NASDAQ:EU) announced today that it has entered into a share purchase agreement (the "Agreement") with Verdera Energy Corp. ("Verdera") pursuant to which Verdera will acquire an enCore subsidiary that holds the Crownpoint, Hosta Butte, Nose Rock, West Largo, and Ambrosia Lake – Treeline uranium projects located in New Mexico (the "Properties") in exchange for 50,000,000 non-voting preferred shares (the "Consideration Shares") of Verdera representing approximately 73% of the current issued and outstanding shares of Verdera on a fully diluted basis,; a 2% net proceeds royalty on uranium, and a 2% net smelter returns royalty on other minerals, extracted and sold from the Properties, and a non-refundable cash payment of US $350,000. The transaction with Verdera represents the fourth and largest transaction to date in enCore’s ongoing program of divesting uranium assets that are not in its production pipeline.
Pursuant to the Agreement, following closing, Verdera will pursue a listing on a Canadian stock exchange by December 10, 2025, which may be extended by mutual agreement of the parties to January 31, 2026. Concurrent with Verdera listing on a Canadian stock exchange, 15,000,000 Consideration Shares will convert into common shares of the resulting listed company (the "Resulting Issuer") and be retained by enCore. The remaining 35,000,000 Consideration Shares will convert into common shares of the Resulting Issuer in connection with the planned distribution by enCore of the shares to its shareholders by way of a stock dividend or similar distribution.
Executive Chairman, William M. Sheriff stated: "As enCore pushes forward on its aggressive uranium extraction plans in South Texas, we continue to execute on our stated non-core asset disposition strategy to create additional value for shareholders. We believe that our New Mexico projects deserve a dedicated focus, which they do not currently receive inside enCore’s broader portfolio of producing and near-term producing assets. With Verdera, we hope to surface additional value, and to eventually transfer much of that additional value directly to shareholders though the distribution of Verdera shares. We look forward to working with Verdera and its Chief Executive Officer, Mr. Tim Gabruch, to see a greater focus on the essential steps to modernize resources and develop long term relationships with local communities to secure a social license for development of the assets. This requires a dedicated effort on the legislative and social fronts over a number of years, important work beyond enCore’s focus, scope and timelines."