Wed, May 27, 2015 - Page 15 News List

PRC bottle maker defaults on bonds

AFP, SHANGHAI

A Chinese bottle supplier for Coca-Cola Co and PepsiCo yesterday said it was unable to fully repay nearly US$100 million worth of bonds, the latest default as growth slows in the world’s second-largest economy.

Zhuhai Zhongfu Industrial Co (珠海中富) has 590 million yuan (US$95.12 million) of bonds due tomorrow, but is only able to return 25 percent of the principal, it said in a statement to the Shenzhen Stock Exchange, where it is listed.

China has seen several bond defaults by both private companies and state-owned enterprises in recent months as growth slowed to 7 percent in the first quarter.

Zhuhai Zhongfu, whose main clients include US beverage giants Coca-Cola and Pepsi, said it would be able to pay interest of 31.15 million yuan.

Chinese Premier Li Keqiang (李克強) in March signaled that China was willing to accept some debt defaults, saying individual cases were “hardly avoidable” under economic restructuring.

Last month, technology firm Cloud Live Technology Group Co (中科雲網科技集團) said it could not meet a 241 million yuan debt repayment, making it China’s first company to default on corporate bond principal.

Shortly after that, a power equipment maker became the first state-owned firm to default on a bond payment in modern China.

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