HSBC wants $214 million
Huishan again in financial trouble
Huishan Dairy, FrieslandCampina's Chinese partner, has again run into financial difficulties. The bank HSBC is demanding $214 million from the Chinese dairy processor. It concerns repayment of several loans. Reuters news agency reported this on Tuesday, September 12.
HSBC's demand puts additional pressure on Huishan Dairy. The Chinese dairy processor has recently resumed talks with creditors and regional government officials. The company hopes to be able to take out new loans with this until it can identify the gap in its finances. HSBC could throw a spanner in the works.
Stock exchange suspension
The problem came to light in March, when Huishan Dairy fell 85% on the stock market. Then it became company from the same stock exchange suspended. Since then, things have been getting worse for the Chinese company. For example, it has missed payments and the company has lost contact with the director, who is responsible for finances.
Letters from HSBC
The bank informed Huishan Dairy in 2 letters that it has several loans with HSBC. They were closed in 2014 and 2015. In 2015, a total of $200 million was borrowed. For that amount, the bank gives a deadline of 3 days, valid from Monday 11 September.
In 2014, Huishan also borrowed $13,7 million, according to the bank. HSBC wants that amount immediately repaid.
Huishan gets into trouble more often
It is not the first time Huishan has been discredited. In April it was reported that Huishan Dairy would be virtually bankrupt. Also in March, Ge Kun, the finance director, suddenly went on sick leave. She has been missing ever since. Huishan Dairy has billions of euros in debt and only has 1 board member.
Kimberly Baker
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