Beijing Enterprises Holdings chairman Hu Zhaoguang has said the company was safe from the financial troubles that brought down Guangdong International Trust and Investment Corp (Gitic).
Mr Hu yesterday said Gitic was shut down because it failed to meet its short-term debt obligations, but its parent, Beijing Holdings, had replaced most of its short-term debt using the US$150 million raised from a bond issue earlier this year.
The listed arm was basically debt free, he said. It had about HK$1.4 billion in cash, officials said.
Beijing Enterprises, the Hong Kong listed arm of the Beijing municipal government, has a debt-to-asset ratio of 23 per cent while the parent's is about 80 per cent.
'There is no need to worry about the issue of our short-term debt. We have only a small portion of short-term debt for trading purposes,' Mr Hu said.
Vice-chairman Guo Yingming said the SAR units had not obtained any guarantees from the Beijing government in raising debts and they did not have to go through the State Administration of Foreign Exchange for approval to raise funds as they were not set up on the mainland.