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Dongbei Special Steel Group restructuring draws creditor ire--The 19th China (Guangzhou ) Int’l Casting product Exhibition
8/31/2017 casting expo-Die-casting expo-foundry expo |
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Caixin Global reported that after a nearly 10 month tug of war between creditors and bankrupt Dongbei Special Steel Group Co Ltd, the state-owned steel maker’s, restructuring plan has been approved by the Intermediate People’s Court of Dalian. Some creditors including bankers have raised a red flag after claiming they were forced to accept unfair financial conditions, apparently as part of a government bid to keep the company alive.
An experienced bankruptcy lawyer who asked not to be named said that “Dongbei Special missed too many bond repayments, and the market impact was too great. Government officials forcefully intervened on behalf of Dongbei, the lawyer said, and as a result the whole restructuring process can hardly be said to have set a good example.”
The plan released August 3 and obtained by Caixin calls for the debt-ridden state-owned enterprise to fully repay every unsecured creditor holding no more than CNY 500,000 (about USD 75,344) worth of debt at face value. Any creditor with more than that amount may be repaid in cash at 22.09% of value, or accept a debt-for-equity swap.
The steel maker and its subsidiaries had defaulted on 10 bonds worth 7.1 billion yuan since March 2016, when the suicide of then-chairman Yang Hua marked the onset of a financial crisis that pulled hundreds of institutional investors into the mire and opened a new chapter in the history of the nation’s bond market.
Dongbei Special’s bond defaults were the first ever permitted by a Chinese government agency for an SOE. Previously, troubled state companies and their bondholders enjoyed implicit government guarantees and sometimes outright bailouts.
鑄件展-鑄件采購會-國際鑄件展-2018第十九屆廣州國際鑄件展會-巨浪展覽
-The 19th China (Guangzhou ) Int’l Casting
product Exhibition
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