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Jane Moir

Liquidators of Yaohan International Holdings are racing against the clock to flesh out a proposal to resurrect and re-list the debt-ridden retailing company.

 Meetings are to be held this week with Yoahan's main bank creditors and proposed investors in the company, which collapsed in August under the strain of $500 million in debt.

 Potential investors met creditors and provisional liquidators last week to discuss a restructuring proposal.

 The Court of First Instance yesterday set a three-week deadline for the company and its provisional liquidators to pull off the deal, putting a winding-up petition brought by creditor Hidomi Holdings on hold.

  Barrister for Yaohan, Eric Yung, told judge Mrs Justice Doreen Le Pichon that an adjournment would allow a 'fruitful pause' for creditors and potential investors.

 Gabriel Tam Chi-kok, one of the liquidators and a KPMG partner, said that talks had been held over the past six months with parties interested in restructuring and re-listing Yaohan on the stock exchange.

 'There is one proposal on the table, but it is still preliminary,' he said yesterday.

 No details were available.

 There are at least a dozen large bank creditors - both Hong Kong and Japanese - whose approval for the deal would have to be sought.

 Mr Tam said the company's debt arose partly from investments it was forced to write off and from loans of about $700 million extended to finance a project in Taiwan.

 Trading in the company's shares were suspended in August.

 Yaohan's core business, a department store chain, went into liquidation in November 1997.

 Its retailing arm, Yaohan Hongkong, was wound up in February.



Yaohan races to firm up revival