A Chinese technology firm yesterday said it cannot meet a 241 million yuan (US$39 million) debt repayment, making it the first company to default on corporate bond principal in modern China.
Cloud Live Technology Group Co (中科雲網科技集團) said in a statement to the Shenzhen stock exchange it was unable to pay principal and interest on a five-year, 480 million yuan bond issue sold in 2012. Investors had an option to be repaid their principal after three years.
Solar company Chaori Solar Energy Science & Technology Co (超日太陽能) last year became China’s first-ever to default on a domestic corporate bond after it was unable to make full interest payments of 89.8 million yuan.
Chinese Premier Li Keqiang (李克強) last month signaled that Beijing was willing to accept some debt defaults, saying individual cases are “hardly avoidable” under economic restructuring.
Analysts say such defaults could benefit the market in the long term by raising awareness of risk and making investors more selective.
However, in the past authorities have stepped in to ensure that most debt holders in failing firms are paid off, and investors poured into Cloud Live shares yesterday, with the stock surging by its 10 percent daily limit to 8.40 yuan, as reports said it could be taken over and restructured.
“The company might have some behind-the-scenes actions or measures, plus the market environment is hot,” Central China Securities Co (中原證券) strategist Zhang Gang (張剛) said, referring to a recent stock rally.
The Xinhua news agency called the Cloud Live default a “precedent-setting” case.
Beijing-based Cloud Live was previously a restaurant chain serving up cuisine from the provinces of Hunan, Guangxi and Guangdong before switching to big data services last year, media reports said.
“Poor core business has led to continuous sharp losses,” Cloud Live said in the statement, adding that it was “faced with numerous lawsuits and an investigation by the China Securities Regulatory Commission.”
China’s securities market watchdog is investigating the company for share price manipulation.
A construction firm, Huatong Road & Bridge Group (華通路橋集團), narrowly missed becoming China’s second corporate bond default last year after paying off its debt using accounts receivable from companies linked to local governments.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the
FUTURE PLANS: Although the electric vehicle market is getting more competitive, Hon Hai would stick to its goal of seizing a 5 percent share globally, Young Liu said Hon Hai Precision Industry Co (鴻海精密), a major iPhone assembler and supplier of artificial intelligence (AI) servers powered by Nvidia Corp’s chips, yesterday said it has introduced a rotating chief executive structure as part of the company’s efforts to cultivate future leaders and to enhance corporate governance. The 50-year-old contract electronics maker reported sizable revenue of NT$6.16 trillion (US$189.67 billion) last year. Hon Hai, also known as Foxconn Technology Group (富士康科技集團), has been under the control of one man almost since its inception. A rotating CEO system is a rarity among Taiwanese businesses. Hon Hai has given leaders of the company’s six