Cloud Live Says Zhongxiang Industrial to Repay Defaulted BondsBloomberg News
Zhongxiang to pay 309 million yuan in debt, fees for firm
That includes 294.4 million yuan of unpaid principal, interest
Cloud Live Technology Group Co., the Beijing-based Internet company that missed a bond payment in April, said a producer of metal products will repay the debt.
Yueyang Zhongxiang Industrial Co., based in the southern province of Hunan, will repay the 309 million yuan ($48.4 million) Cloud Live owes on the security, a default penalty and legal fees, according to a statement dated Wednesday from the board of Cloud Live. That includes 294.4 million yuan for all the unpaid principal and interest of the bond issued in 2012 with a coupon rate of 6.78 percent. The company failed to meet an April 7 deadline to pay investors who had exercised an option to sell back the securities, which mature in 2017.
The debt payment would help ease investors’ concern about defaults after about 43 companies canceled or delayed 46.7 billion yuan of notes this month. China Shanshui Cement Group Ltd. this month became at least the sixth firm to default in the local corporate bond market this year amid a shareholder tussle.
GF Securities Co., the lead underwriter of the bond, will help unfreeze the company’s pledged shares and assets within 20 days after Zhongxiang makes the payment, the statement said.
The debt repayment plan is subject to the approval of Cloud Live’s board, shareholders and bondholders, according to the statement.
— With assistance by Judy Chen