Yanin asks court to appoint receiver to extend repayments

Yanin Leather Co Ltd (延穎實業) asked Taiwan's courts to appoint a receiver to run the synthetic leather maker, which is laboring under NT$6.1 billion (US$183 million) of debt, more than 80 times its market value. The move comes as the company's creditors are pushing for Yanin to be declared bankrupt and broken up and sold, according to a securities firm which helped the company sell debt.

"The banks have applied to the court to declare the company bankrupt, which would force the company to shut down," said Albert Lin, bond department manager at Taiwan International Securities Corp.

Taiwanese manufacturers are struggling to repay debt because of a slump in their major export markets and competition from cheaper producers elsewhere in the region. Tuntex Distinct Corp (東雲紡織) this week sought court protection from banks and rival textile maker Hualon Corp (華隆) asked for government help in creditor talks.

Yanin wants a receiver appointed so the company can continue operating and prepare a plan to reorganize its debt through write-offs and an extension of the repayment schedule, said Fong Hsiao-hung, a Yanin spokesman.

The company, which has a market value of NT$70.1 million, owes money to Bank of Taiwan (台灣銀行), Grand Commercial Bank (萬通銀行), and Taiwan Business Bank (台灣企銀), among others.

The maker of synthetic leather used for handbags and automobile interior designs defaulted on NT$160 million of bonds that came due last year and since then hasn't paid interest on NT$200 million of bonds that mature on June 18, Lin said.