Shanghai Dasheng units default on $14 mln loan repayments, stock dives

Shanghai Dasheng Agriculture Finance Technology Co

29/05/2018 03:39

HONG KONG, May 29 (Reuters) - Shanghai Dasheng Agriculture
Finance Technology Co Ltd.  1103.HK  said on Tuesday two of its
units had defaulted on loan repayments totalling $14 million,
the latest Chinese company to default amid a crackdown on
financial risk.
    The news sent the stock down 19.8 percent to an all-time low
at HK$0.073 in early trade on Tuesday.  
    It is the latest in a wave of corporate debt defaults amid a
government-led campaign to crack down on risky financing, and
follows a reminder recently from China's securities regulator
that exchanges should monitor default risks. 
    China Energy Reserve & Chemicals Group Co said on Monday it
failed to repay a $350 million bond that matured earlier this
month due to a "tightening in credit conditions".  urn:newsml:reuters.com:*:nL3N1SZ31P
    Shanghai Dasheng said the Pudong Branch of Bank of Shanghai
Co Ltd had filed a claim against its units, Shanghai Dasheng
Agricultural Products Co Ltd and Shanghai Dasheng Agro-chemical
Co Ltd, for breaching loan agreements amounting to 89.9 million
yuan ($14 million), and all related interests. 
    The company and its controlling shareholder, Shenzhen
Dasheng Agricultural Group Co Ltd, which are the guarantors to
the loans, were named as defendants in the claim. Hearings are
scheduled for June 21.
    The petrochemcial products trader said it is seeking legal
advice on the proceedings and the impact on its financial
position would become clearer after the hearings. 
($1 = 6.4069 Chinese yuan renminbi)

 (Reporting by Donny Kwok
Editing by Darren Schuettler)
 ((donny.kwok@thomsonreuters.com; +852 2843 6470; Reuters
Messaging: donny.kwok.reuters.com@reuters.net))