Oil giant CEFC China’s debt woes widen as unit defaults on commercial paper
The default by the Shanghai unit comes days after the group put up Hong Kong property assets for sale to repay debt
CEFC Shanghai International Group, a unit of the country’s largest private oil conglomerate CEFC China Energy, said on Monday it failed to repay principal and interest on 2.1 billion yuan ($306 million) worth of commercial paper due on August 20.
The unit said it defaulted because operations had been seriously affected by recent negative events at the company, and it is actively raising funds to repay investors.
The announcement was made in a statement via the Shanghai Clearing House.
Earlier this month, CEFC China Energy, which is struggling to repay mounting debts, put up property assets worth HK$3.3 billion (US$420 million) in Hong Kong for sale in a tender that will close on September 11.
CEFC China had 98.3 billion yuan of outstanding debt as of July, and has already defaulted on three bonds in May and June worth a total of 6.5 billion yuan.
A creditors’ committee has taken over its daily operations, as chairman Ye Jianming has been detained for questioning regarding the debts since February, the Post reported earlier.
