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China’s Tsinghua Unigroup says creditors back restructuring plan – Metro US

China’s Tsinghua Unigroup says creditors back restructuring plan

FILE PHOTO: The logo of Tsinghua Unigroup is seen in
FILE PHOTO: The logo of Tsinghua Unigroup is seen in its office in Beijing

BEIJING (Reuters) -China’s debt-laden Tsinghua Unigroup on Wednesday said creditors had backed a draft restructuring proposal for the chip conglomerate after local media reported that a strategic investment of 60 billion yuan ($9.42 billion) was on the way.

Creditors representing more than 90% of outstanding claims voted in favor of the draft restructuring proposal at an investors’ meeting on Wednesday, Unigroup said in a statement.

Unigroup’s two shareholders, Tsinghua Holdings – owned by China’s prestigious Tsinghua University – and Beijing Jiankun Investment Group also voted for the plan, it added, without providing details of the proposed restructuring.

The 21st Century Business Herald reported earlier on Wednesday that the 60 billion yuan would be in place by the end of March.

Earlier this month, Unigroup said a consortium led by Beijing Jianguang Asset Management, also known as JAC Capital, and Wise Road Capital would become a strategic investor.

Unigroup, under former real estate magnate Zhao Weiguo, made aggressive investments in various chip companies but these bets were mostly unsuccessful and caused the company to cross-default on bonds worth about $3.6 billion by end-2020.

Administrators will now submit the draft restructuring proposal to Beijing No. 1 Intermediate People’s Court for approval in accordance with Chinese bankruptcy laws, Unigroup said on its website.

($1 = 6.3718 Chinese yuan renminbi)

(Reporting by Sophie Yu, Tony Munroe, Samuel Shen and Beijing Newsroom; Additional writing by Tom Daly; Editing by Christian Schmollinger and Mark Porter)

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