New Reason to Pay Back Lenders: They Might Kill You

Last week, I posted One of China's Richest Men Cannot Repay Banks, Suspected of Illegal Fundraising.

The story deepened over the weekend, with the man in question, Liao Rongna, still out of contact. One lender has threatened to hunt Liao Rongna down and kill him if he doesn't repay his debts.

Liuzhou's richest man, lost contact after ten billion debt lenders threaten to kill

Things change, Liuzhou is experiencing an unprecedented storm.

More than a year ago, the high-spirited, Liuzhou turbot Group Co., Ltd. (hereinafter referred to as "positive Ling Group"), led by the head of Liao Rona four children Liuzhou turbot building foundation.

Today, tens of billions of debt turbot Group is involved in the investigation of illegal deposits from the public was the public security organs, Liu Rona and their children also collectively lost contact.

However, aboard ship in more than 26 billion yuan of assets, the shock waves have affected many aspects.

And when the public security organs involved in conducting an investigation, the "China Business" reporter also learned exclusively authorities turbot group consisting of financial claims defuse Working Committee (hereinafter referred to as the "Committee"), the work of the Commission has been stationed turbot Group and Under his leadership by the Industrial and Commercial Bank of China [ -0.55% funding research report ] Liuzhou Branch and other banks developed a plan to resolve the debt crisis.

Getting out of debt solutions to resolve

"We have had no new cases to be published." June 5, Liuzhou Zhou, deputy director of Foreign Affairs Office, told reporters that "external liabilities of ten billion yuan of such rumors saying there is no public disclosure of Liuzhou now Public security organs are still under further investigation, the specific amount of this level we do not know. "

May 28, Liuzhou City Public Security Bureau of Economic Investigation Detachment with a notice that my detachment found Liuzhou turbot Group Ltd. alleged crime of illegal deposits from the public in the work, after preliminary investigation, in April 2014 according to the law of the Corporation alleged illegal deposits from the public criminal investigation, please contact Liuzhou turbot Group Limited (including subsidiaries, company executives) have to raise relations units and individuals within the provisions of this notice period (May 29, 2014 to 2014 On June 13), to the designated place to register.

So far, turbot Group debt bankruptcy rumors were formally confirmed. Back in March of this year, a number of sites in Guangxi, involving turbot group can not repay a loan shark posts already emerging. In early April, Tencent estate Liuzhou station then published an article "Biography turbot Group in April declared bankruptcy five lines are its assets investigation," the article. This article mentioned turbot Group's liabilities up to ten billion yuan, the bank suspended loans to turbot Group, and loans for investigation.

After the article came out, causing a positive group turbot rebound. June 4, Tencent official told reporters Liuzhou estate, then to the overall situation, and finally removed the article.

Although the article is removed, but after more creditors as turbot Group dun, liabilities hundred million allegedly illegal deposits from the public issues are hidden behind Mitsubishi Group are gradually exposed. Link for the problem being faced by the Group, Liuzhou public security organs in the investigation, but also set up a working committee to dispose of turbot group facing a debt crisis.

It is understood that the work of the Commission has been stationed turbot Group, and joint lead arranger banks in Liuzhou Liuzhou Branch of Industrial and Commercial Bank Under his leadership, Minsheng Bank [ -0.80% funding research report ] , Huarong Xiangjiang Bank to develop relevant disposal program.

Received a submission to the Government of Liuzhou "About resolve turbot Group debt risk program instructions" from close to the work of the Committee of the key persons reporters. Consult claimed, on the one hand turbot Group's effective asset investigation has been initiated; preliminary work is indeed the right hand is also steadily; but turbot Group's debt crisis has erupted several months, debt restructuring is still slow progress in the upcoming miss defuse the risk of prime time, a committee of the Group's work and turbot The study, developed a plan to resolve the debt crisis.

Reporters learned that the program will be to resolve the debt crisis Ling Group's assets are retained assets and disposal of assets into two parts.

Retained Assets is an enterprise engaged in the production and produce normal operating net profit entities, such as factories and hotels, etc., can play a part of the assets or capital gains amplification effects, such as industrial land degeneration of land for development of a commercial nature; disposal of assets that can not increase their solvency and financial burden will bring assets.

After dividing the assets of two parts, the establishment of a new company to undertake the assets retained by the Government or the Commission, to retain full use of the assets, to enhance the company's profitability.

After the establishment of the new company, Mitsubishi Group will undertake currently about 70% of the principal amount of debt (including financial and non-financial debt claims), debt principal about the remaining 30% corresponds to the disposal of assets, disposal of assets is insufficient to cover the range, through The new company's future net income generated annually to repay each year until the debt repaid.

To this end, the Group's financial claims are resolved turbot Committee also proposed that the new company offers a range of Liuzhou tax relief incentives in the transfer of assets, land degeneration, etc., and the new company to take protective measures to cut off risks and ensure normal operation of the new company.

These key sources, June 3rd meeting of local government in principle by the program. However, as of press time reporter ended, Liuzhou relevant departments undisclosed related programs.

Qian Kun Da Nuo advance

"Turbot Group's assets should be far more than 10 billion yuan." June 5, people familiar with the Liao Rona Chen Min (a pseudonym) told reporters, "From our understanding of the situation, the Group's current core turbot There are at least 12 billion yuan of assets, plus some newly acquired businesses, and has not yet completed the formalities for change of land and other assets, as well as 7 billion to 80 billion, he is at least 200 billion yuan of assets, if we can make an inventory of assets , can solve the debt crisis. "

Turbot Group official website information display, turbot Group's assets over 10 billion yuan. Disclosure announcement with reporters from doing business turbot Group ST East for listed companies (002248.SZ), we found a positive Ling Group's assets in more detail.

Weihai Huadong Automation [ 0.36% funding research report ] an announcement Limited disclosure shows that as of July 31, 2013, turbot Group's total assets of RMB 2654115.87 million, total liabilities of RMB 851870.58 million and net assets of RMB 793,456.53 million. January to July 2013, operating income of 1,318,723.69 yuan, net profit of 1,141,660,600 yuan. However, the above figures are unaudited.

Clearly, from this point of view debt data disclosure, after the outbreak of the crisis associated with the turbot Group rumored $ 10 billion of debt only a thin 1.5 billion yuan or so. Assets is significantly higher than the case of turbot Group's official website and media reports.

Reporters in the survey also found that, with up to 26.5 billion yuan of assets turbot Group from February 2014 to begin the group level as well as the ownership structure of its core businesses conducted a number of changes.

Business registration information display, the registered capital of 60 million yuan of Liuzhou turbot Group Ltd. in February 2014 made changes to the original Group Ltd. Liuzhou turbot served as executive vice president Yang Donghai legal representative, chairman, Liu Rong satisfied only role as a Director in the company.

Turbot Group level changes occur outside Mar. 2014 Mitsubishi Group's various subsidiaries are also changed. March 11, to shareholders registered capital of 8 million yuan of Liuzhou Rongsheng Real Estate Development Co., Ltd. is changed, the original accounting for 51% of the shares of turbot group disappeared from the list of shareholders, the shareholders, leaving only Lu Chen, Bernice Liu Qun, Huang Fang, three individual shareholders.

March 20, 2014, the registered capital of 10 million yuan in Guangxi Liuzhou Thai vehicle shareholder limited liability company changed, the original accounting for 84% of the shares are no longer a corporate shareholder Mitsubishi Group, which has 廖昌勋 and two natural persons as shareholders Tran flow.

March 11, 2014, Liuzhou Baling registered capital of 20 million diesel engine parts plant in the list of shareholders, holding 51% of turbot group also withdrew from the company, the shareholders of the company by the number of individual shareholders components. March 24, the registered capital of 42 million yuan of Liuzhou Automobile Gear Works changes have taken place, the former holding 51% of the turbot Group withdrew from Qiao Ling Zhang, Shu Huiming, Chang Liao Zhai, and many other individuals as shareholders.

Since the coefficient of Liu's family lost contact, it is unclear Liao Rona hastily penned in 2014 to change the reasons for these options. However, the reporter learned from informed sources, perhaps with these changes before the outbreak of the debt crisis, Liu Rong Carolina in advance of its assets reorganization.

Since June 2013 the banks have tightened lending, is undergoing major expansion phase of turbot in order to maintain production and management group to begin lending usury. Chen Min also known as the situation: "Liao Rona told me that the bank not later than promised loans down in September 2013, a temporary loan shark to maintain production is no problem."

However, the bank did not honor their commitments. Chen Min said: "The money can only be satisfied Rong Liao desperately loan shark, monthly interest rate a quarter, one-fifth of usury, and even up to a gross usury." That time, in Liuzhou some forums, and even some people from time to time usury to be able to boast the richest man in Liuzhou Liu Rona.

By the end of 2013, under the turbot Group shattering rely on loan sharks to stay afloat is also difficult to continue the case, banks and private lenders have dun to turbot Group. Liao Rona also frequently sought by the parties to support the government and civil associations channels, hoping creditors to accept a buffer solution to stop dun let turbot Group first ride out the storm and then pay back the money. However, Liao Rona request has not been recognized creditors. Even radical individual borrowers do not pay back the money it also threatened to kill Liu Rona.

It is usury and bank credit limit "combined", eventually being cornered Link Group. Before lost contact, Liao Rona hurry subsidiary of the Group to equity levels have been adjusted. These equity adjustments, the Commission early in Liuzhou stationed turbot group consisting of time.

Currently creditor concerns, turbot Group is no longer relevant after the controlling shareholder of a subsidiary, a subsidiary of good assets still belong Will undertake corresponding obligations are owed under the Link Group.

Fear of the fermented debt risk

Over time, turbot Group debt risks being further fermentation.

"Turbot former Department of normal production and operation enterprises have been affected to varying degrees." When asked recently, turbot Group Report of the Working Committee to resolve financial claims to the Liuzhou government: "Enterprise operating difficulties emerged, corporate downsizing, declining operational capacity risk, if not promptly take measures to resolve the debt crisis, these companies will face shutdown. "

Guilin, a financial institution executives also said: "The current Guilin upstream suppliers are hesitant to back turbot Group's machinery enterprises supply, worried their payment performance capabilities."

Turbot our sector, a very important industrial sector is the machinery sector. The sector is responsible for the son Liaochang Jin Liu Wing satisfied. Public information, turbot Group constituted including Fujian Industry Group Co., Ltd. Kay reported, Xuzhou XCG turbot Engineering Co., Liuzhou turbot Machinery Manufacturing Co., Ltd., Liuzhou Automobile Gear Factory, Liuzhou Baling Diesel Engine Parts Factory Liuzhou Dongfeng Motor [ 0.33% funding research report ] Parts Plant, Liuzhou automotive transmission factories and other enterprises, and formed a car, excavators, loaders, machine tools, engines, auto parts core industries.

Information from the public point of view, the company's auto parts enterprises but also for some car companies supporting. Once these parts production will have an impact on affected some domestic auto companies.

Turbot crisis affecting the Group, the Group's debt crisis turbot also affected the automobile industry chain to a number of listed companies. Guangxi Guidongdianli [ -0.88% funding research report ] (600310.SH) announcement shows, turbot group suspected of possible illegal deposits from the public on the company and its wholly owned subsidiary, Qinzhou Win Group Co., Ltd. to Liuzhou turbot collection significant impact related payments, such as payments related to the formation of these losses, will be the company's financial condition and results of operations could materially and adversely affected. A more detailed disclosure of the company's display case, its subsidiary in 2013 and Qinzhou Insein turbot Group took place four transactions, Qinzhou Win To this end the bank out of the face value of about 200 million yuan acceptances.

"China Business" reporter also found, ST East several times to provide loan guarantees for the turbot Group. Which in March 2011 to provide 30 million yuan of bank loan guarantees for turbot Group. Announcement 3 September 2013 show that the company intends to apply for turbot in the banking group to provide joint and several liability does not exceed RMB 630 million loan guarantee. October 9, 2013, the company secured shareholders' meeting adopted the motion.

In addition, Liao Liao named Rona Rona Foundation has also taken a hit. In 2012, the Home Office approved the establishment of the Guangxi Liu Wing Kea gold. Actual operation, the Foundation launched a public service pension services, the project combines public service pension Liao Rona's financial operations platform, through commercial operations staff pension funds solve the problem of pension predicament. The project, a 50,000 yuan deposit pension staff, Foundation staff 750 yuan monthly living expenses for pension, equivalent to 15% per annum. With the group being investigated after turbot, many people chose to quit.


Foundation vice president Liaoyong Guo said that the operation of the Foundation is in accordance with national laws and regulations to run, but did not think there will be such a positive group turbot big crisis, and now there are millions of foundation funds on turbot Group financial management, as long as is proposed refund, the refund will be positive, has more than 400 million refund. "I believe the government when disposing of the underlying assets, will take into account the special nature of the Foundation, and will not let the people's pension money to be swept away." 廖勇国 said.

Reporters learned from the Home Office in Guangxi, the relevant government departments are to follow up the case. Miss He Junrong, deputy director of the Guangxi Bureau of Civil Affairs of civil society organizations, said: "There has been a meeting Board to study the matter for the relevant issues very seriously, will further understanding." Reporters survey, a person familiar with turbot Group repeatedly stressed the positive Link Group is not a sleight of hand tricks, Liao Rona thirty years has been in development entities, but encountered a special case of banks to tighten lending, resulting in a debt crisis, now might make turbot group to come forward by the government to reorganize survive the storm.

However, experienced unprecedented toss, companies are caught in a heavy crisis turbot Group is also able to have tomorrow?