Payson Cha and brother apply for court order to wind up ATV over debt
Two former ATV directors yesterday filed an application with the High Court to wind up the television network.
Hong Kong brothers Payson Cha Mou-sing and Johnson Cha Mou-daid took the action after ATV failed to repay a loan of HK$200 million owing since August 2008 and accumulated interest of about HK$91 million.
The Cha brothers acquired the HK$200 million loan - which was in the form of a convertible bond - when they invested in the television station in 2007.
The bond matured in March this year and repayment of the loan has been due since then.
The Cha brothers said in a statement that they had served a statutory demand on ATV seeking repayment of the loan on March 27, but the station had failed to pay back any of the loan or interest owing.
The Cha brothers also said they had offered to consider extending the time given to repay the loan, with conditions attached, but ATV had not responded with any "serious proposal".
They also intend to launch proceedings against Wong Ching, the mainland tycoon also known as Wang Zheng, who bought the Cha brothers' shares in ATV in 2010.
Wang gave the Chas a guarantee that ATV would repay the loan, and if it did not he promised to purchase the loan at face value, according to the Chas.
The Chas said they were hopeful that ATV and Wong would honour their obligations to repay the loan and that this would allow ATV to "regroup and move forward".
ATV issued a statement in response to yesterday's application, saying that the Cha brothers had bought the loan in the form of convertible bonds from a bank for HK$40 million many years ago and that it was "a problem left over by history".
The station expressed regret over the legal action taken by the Chas and said it hoped they would terminate proceedings and return to the negotiating table to settle the dispute.