CEFC defaults on 2 billion yuan of bonds as fallen oligarch’s asset-buying firm goes rudderless

A principal unit of embattled CEFC China Energy, a freewheeling asset buyer controlled by financier Ye Jianming, has failed to repay a 2 billion yuan (US$313 million) bond that expired on Monday, exacerbating worries about the outlook of the once-prominent energy conglomerate.

CEFC Shanghai International Group was not able to pay back the principal of 2 billion yuan, as well as 88.8 million yuan of interest for the nine-month notes issued on China’s interbank market, according to a statement on the website of the Shanghai Clearing House.

The default arose from substantial changes in its operations because Ye, chairman of the parent company, could not assume his role amid failed attempts to raise fresh capital to repay debts, the company said, adding that it would need another six months to pay back the debt.

Ye is being investigated by Chinese authorities for suspected economic crimes, and could not be reached to comment.

CEFC, one of China’s biggest asset buyers over the past years, is under pressure to repay debts it used to fund the acquisitions around the world, which were valued at about US$12 billion.