China Coal Miner That Defaulted Last Week to Make Full Payment

  • Chinacoal Group Shanxi Huayu Energy to pay 638.6 million yuan
  • Company didn't say where it got the funds to make payment

A Chinese coal miner that failed to make a bond payment last week said it will repay the debt in full.

Chinacoal Group Shanxi Huayu Energy Co. will pay 638.6 million yuan ($98.8 million) in principal, interest and a default fine on the 6.3 percent notes on Wednesday, it said in a statement dated April 12 on the Shanghai Clearing House website. The coal miner, which is based in the northern province of Shanxi, sold the securities last year.

“The company overcame difficulties and actively strove to raise funds from various channels,” it said in the statement, without saying where it got the funds.

Mounting debt burdens in China have caused at least seven firms to miss local bond payments this year, already reaching the tally for the whole of last year. Dongbei Special Steel Group Co., whose chairman was found dead by hanging last month, defaulted on securities a second time in two weeks last Tuesday.

Chinacoal Group Shanxi Huayu’s bonds, which were issued with a 600 million yuan face value, were due on April 6. On that day, the Shanghai Clearing House said in a statement it hadn’t received funds from the company to pay holders of the securities.

— With assistance by Jill Mao, and Stephen Tan

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