Nanjing Yurun Food’s default on $77m worth of short-term notes triggers cross-default

Source:Reuters-Global Times Published: 2016-3-22 21:08:11

China Yurun Food Group said that a default by a unit on short-term notes worth 500 million yuan ($77 million) has in turn triggered other provisions that require the immediate repayment of debt worth 1.45 billion yuan, Reuters reported on Tuesday.

The unit, Nanjing Yurun Food Co, has arranged partial repayment of the short-term notes but the meat-processing company's board of directors believes the likelihood of an immediate repayment for the other debt is not high, it said in a statement late on Monday.

It said that it is in talks with banks on the matter.

The partial repayment of short-term notes amounts to 220 million yuan for the principal and 32.3 million yuan in interest. It still owes 280 million yuan.

Trading in shares of China ­Yurun Food Group was suspended on March 18 pending a statement on the potential impact from the default on domestic short-term financing notes issued by its unit Nanjing Yurun Food Co. Trade in China Yurun shares resumed on Tuesday.

Nanjing Yurun has defaulted on a 500 million yuan short-term financing note repayment due on Thursday, the company said.

Hong Kong-listed China Yurun Food Group declined 3.62 percent to HK$1.33 ($0.17) on Tuesday.

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