Bankers' mistrust grows as questions over missing cash go unanswered
Creditors owed $4.49 billion by one of the Zhuhai municipal government's key investment arms have taken urgent legal steps to protect assets and liquidate companies in the group following a complete breakdown in trust amid swelling fears over missing cash.
Winding-up petitions have been filed against Zhu Kuan Group (Zhu Kuan Uniao Comercial E Industrial) and Zhu Kuan (Hong Kong) by Standard Chartered, one of the creditor banks. Other creditors of the group include BOC Hong Kong (Holdings), ICBC (Asia), Bank of America and Societe Generale.
Provisional liquidators from RSM Nelson Wheeler have been appointed by the High Court to investigate the state of affairs at the companies and take possession of all assets.
Zhu Kuan Group has racked up debts of $6.34 billion, $4.49 billion of which is owed to 28 banks, most of which are in Hong Kong. Attempts at a restructuring hit a wall last month when Zhu Kuan Group put a derisory offer of 18 per cent on the table.
Moreover, talks seemed to have broken down after creditors discovered one of the key assets within the group - the right to use a parcel of land which would serve as the entry point for the Hong Kong-Zhuhai bridge - had been handed over to the Zhuhai government.