IT Holding Unit, Ssangyong, Japan Data, Lehman H.K.: Bankruptcy

IT Holding SpA, owner of the Gianfranco Ferre fashion label, said Ittierre SpA, its main production and licensing unit, will file for bankruptcy protection after failing to find adequate funding.

The bankruptcy order may be extended to the whole company, the Milan-based clothing maker said today in a statement to the Italian exchange. Under the terms of IT Holding’s 185 million- euro ($240 million) senior notes due in 2012, bondholders can call for immediate repayment if a subsidiary goes into administration.

IT Holding, controlled by Chairman Tonino Perna, missed a loan payment in October and an extension two months later. The company said last week it was in arrears in paying royalties to the designers Ittierre makes and sells luxury goods for, including Roberto Cavalli and John Galliano.

“The board ascertained the absence of the conditions necessary to continue its operations in a regular course of business,” IT Holding said in the statement, citing a lack of financial resources and the unwillingness of its licensors to alter their agreements.

“Given that in the case of the application of the bankruptcy procedure to one of the group’s subsidiaries, the bond becomes immediately redeemable, we expect the parent company IT Holding to eventually file for extraordinary administration too,” UniCredit Markets & Investment Banking analyst Davide Vimercati said in a note today.

Ssangyong Motor Falls on Outlook After Receivership

Ssangyong Motor Co., South Korea’s smallest automaker, dropped by the most in more than three months in Seoul trading on concerns about its outlook after the company won bankruptcy protection.

Ssangyong Motor dropped by the daily limit of 15 percent to close at 1,130 won in Seoul. The stock resumed trading today after it was suspended on Jan. 9, when it applied for court protection.

The Pyeongtaek, South Korea-based automaker won court protection on Feb. 6 after suffering from a “serious liquidity crisis” amid a global recession. Ssangyong Motor could still be liquidated should the turnaround plan submitted by the new court-appointed managers be deemed unviable.

“There’s just too much uncertainty surrounding Ssangyong Motor,” said Kang Sang Min, an analyst at Tong Yang Securities Inc. in Seoul. “Even if Ssangyong Motor is put for up for sale, it’s going to be difficult to find anyone interested, considering how automakers worldwide are struggling with declining sales.”

The global recession has hammered demand for vehicles in South Korea and overseas, forcing General Motors Corp. and Chrysler LLC to turn to the U.S. government for loans to support operations. Toyota Motor Corp., the world’s largest automaker, expects its first annual operating loss in 71 years.

Ssangyong Motor’s sales tumbled 30 percent to 92,665 vehicles last year as customers shunned its aging line-up of gas-guzzling SUVs in favor of more fuel-efficient cars made by domestic rivals Hyundai Motor Co. and Kia Motors Corp.

The court receivership ended Shanghai-based SAIC Motor Corp.’s four-year control of the South Korean automaker.

Japan’s Machinery Orders Slide, Bankruptcies Climb

Orders for Japanese machinery fell for a third month in December and bankruptcies increased as businesses scrapped investment plans amid a collapse in exports and deteriorating earnings.

Bookings slid 1.7 percent from November, when they fell 16.2 percent, the sharpest drop since the survey started in 1987, the Cabinet Office said today in Tokyo. Corporate bankruptcies rose 15.8 percent to 1,360 cases in January, the eighth monthly increase, Tokyo Shoko Research Ltd. said in a separate report.

A wave of firings and canceled spending plans by Japanese manufacturers has heightened the risk of a prolonged recession, as fallout from the global slowdown ripples through the domestic economy. Nissan Motor Co., Japan’s third-largest automaker, said today that it will cut 20,000 jobs after predicting a loss this fiscal year as the global recession cripples car sales.

Lehman H.K. Creditors to Meet Liquidators This Week, FT Says

Creditors of Lehman Brothers Holdings Inc.’s Hong Kong operations will be briefed by liquidators this week as they seek to recover billions of dollars owed by the bankrupt investment bank, the Financial Times reported.

Court-appointed provisional liquidators at KPMG have scheduled eight credit meetings during the week starting Feb. 11, the newspaper said. There will be one for each of the eight subsidiaries that together account for the bulk of Lehman’s Asian operations outside Japan, it added.

The accounting firm said it would use the opportunity to update creditors on its work and to discuss a possible asset disposal program, according to the report. Creditors attending the meetings may be able to form committees of inspection to help and oversee the liquidators’ work, it added.

Lehman’s Hong Kong operations built up billions of dollars of Asian property holdings through loans and investments, the newspaper said. Last year, KPMG estimated after an initial assessment that the assets it was in charge of could be worth as much as $20 billion. It hasn’t disclosed total debt, yet could do so after the final creditor meeting next week, it added.

WMF Won’t Bid for Insolvent Rosenthal, Handelsblatt Reports

WMF-Wuerttembergische Metallwarenfabrik AG won’t make a bid for insolvent porcelain maker Rosenthal AG, Handelsblatt reported, citing WMF Chief Executive Officer Thorsten Klapproth.

Waterford Wedgeford Plc, the insolvent Irish owner of Rosenthal, has been trying to sell the German unit since June, the German newspaper reported. Potential buyers include Sambonet Paderno Industria of Italy and Germany’s Schoerghuber-Group, the newspaper said.

To contact the reporter on this story: Jeff St.Onge in London at jstonge@bloomberg.net

To contact the editor responsible for this story: Anthony Aarons in London at aaarons@bloomberg.net

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