China Shanshui Cement Group has announced that its wholly-owned subsidiary, Shandong Shanshui Cement Group Co., Ltd, may be unable to pay approximately RMB2 billion in onshore debt due on 12 November. In a statement, the group said it was exploring options to raise financing to enable the repayment of the debt. This has been ongoing since June 2015, but the company has struggled to raise the finances because of uncertainty over the company’s management. One of its major shareholders, Tianrui Cement, has repeatedly tried to oust some of the board members, with partial success, and continues to be unhappy with the board structure.
Bloomberg reports that global investors are increasingly being ‘scarred’ by defaults from Chinese companies. Analysts interviewed by Bloomberg suggested the announcement might prompt shareholders to assist the company to find financing.
Edited from various sources by Katherine Guenioui
Read the article online at: https://www.worldcement.com/asia-pacific-rim/06112015/china-shanshui-cement-group-struggles-to-pay-off-debt-931/