Top mainland dairy group Taizinai, which counts Wall Street banks Goldman Sachs and Morgan Stanley among its major shareholders, has collapsed into provisional liquidation owing lenders three billion yuan (HK$3.41 billion).
Taizinai, which is best known for its probiotic yoghurt drinks, has been struggling since at least 2008, two people with knowledge of the privately held company said.
Chairman Li Tichun overspent on a massive expansion of the firm's factory bases, just before the mainland's dairy industry was rocked by the tainted milk scandal, in which close to 300,000 people were poisoned by products containing the harmful chemical melamine.
The Hunan-based firm did not sell any contaminated products, but a lack of consumer trust hurt its sales, the people involved with the company said.
The Grand Court of the Cayman Islands appointed Hong Kong accountants Borrelli Walsh as Taizinai's provisional liquidators on Monday night, documents reviewed by the Post showed.
Citi, the US bank, is Taizinai's biggest lender. The dairy group also owes money to Britain's RBS and Singapore's DBS.
