China Shipbuilder Evergreen Defaults on Bond Amid Cash ShortageBloomberg News
Evergreen is at least the 10th company to default this year
Company considering asset sale to raise funds for payment
A Chinese shipbuilder defaulted on bonds, becoming at least the 10th company to miss local debt payments in the world’s third-biggest note market this year.
Evergreen Holding Group Co. said it can’t make full payment due Monday on a one-year notes because of a cash flow shortage, according to a statement on Shanghai Clearing House’s website. The company, based in the eastern province of Zhejiang, sold the 400 million yuan ($61.3 million) of bonds with a coupon rate of 7.95 percent in May 2015.
Credit woes are spreading in China as both privately held and state-owned firms struggle with record debt repayments this year amid the worst economic slowdown in a quarter century. Nanjing Yurun Foods Co., a sausage maker, recently missed a payment for a second time in two months before saying Monday it had later made the payment.
Evergreen is making efforts to raise funds for the 431.8 million yuan in principal and interest, including selling assets, according to the statement.
— With assistance by Dingmin Zhang, and Judy Chen