Daily Insolvency News Headlines

Thu., November 20, 2014

Thu., November 20, 2014

German television maker Metz has filed for insolvency, a spokesman for the company said on Wednesday, adding that about 600 jobs would be affected, Reuters reported. Joachim Exner, who co-managed the insolvency of German peer Loewe, has been appointed as insolvency administrator, the spokesman said, adding that the company's production and customer services would continue for the time being. Peer Loewe sought protection from creditors in July 2013 and filed for insolvency in October after a strategy to combat the economic downturn by focusing on premium customers failed. Read more.

Wed., November 19, 2014

Wed., November 19, 2014

One Hong Kong-based hedge fund has accumulated the prospectuses of no fewer than 250 of the trust companies that sit at the heart of the Chinese shadow banking system. These contain virtually no disclosure except on the value of the real estate that backs loans whether committed or proposed. In some ways, China today resembles Japan in the early to mid-nineties or the US in 2007 to 2008 on the eve of their respective financial crises, both triggered by overvalued property. It is not only that property companies are huge borrowers (in the case of China both domestically and in the offshore US dollar high yield bond market), it is that many other borrowers in China can only take out loans if they have property to serve as collateral. Now the combination of a weak property market and record leverage among Chinese corporates has become one of the major concerns of investors in both Chinese shares and debt. Rising leverage, much of it involuntary as sales and cash flows weaken across a host of sectors, will at some point lead to rising non-performing loans at both banks and non-banks, limiting their ability to provide credit in future. And in the context of China, nobody knows whether that is even a good or bad thing, given the excess capacity in sectors from cement and coal to ships and steel. Read more. (Subscription required.)

Wed., November 19, 2014

The Singapore arm of bankrupt Danish shipping fuel trader OW Bunker will meet with its liquidator KPMG in early December to discuss the firm's outstanding debt, which totals almost $1.5 billion globally, Reuters reported. OW Bunker, a leading supplier of marine fuel oil known as "bunker", filed for bankruptcy in Denmark earlier this month after it revealed losses of at least $125 million at one of its Singapore-based subsidiaries Dynamic Oil Trading, sending the bunker fuel market into turmoil. Oil firms have stepped up legal action against OW Bunker's Singapore units since the announcement with the arrest of ships, now totalling seven, Singapore court documents show. Six vessels - Star Quest, Petro Asia, Luna, Nepamora, Zmaga and Arowana Milan - were arrested in the city-state over Nov. 15-17 by Rajah & Tann Singapore LLP, which earlier this month also arrested ship fuel delivery barge Laguna. The law firm made the latest six arrests on behalf of Phillips 66 International Trading Pte Ltd, a court official said. Phillips 66 could not be reached for comment. Read more. (Subscription required.)

Wed., November 19, 2014

The Bank of Russia had no other option but to let the ruble float freely, and the decision to do so had helped stop it from hitting fresh record lows, Elvira Nabiullina, the bank’s chairwoman, said on Tuesday, The Wall Street Journal reported. The ruble has lost more than 30% of its value against the dollar so far this year, hit by lower oil prices, capital outflows and Western sanctions stemming from the Ukraine crisis. After $30 billion on intervention failed to stop the ruble from falling to all-time lows in October, the central bank decided to switch to a free float from Nov. 10. In what seemed to be the first acknowledgment that the central bank was no longer able to stop the ruble from falling, Ms. Nabiullina said that it was “impossible to stand against fundamental factors” in a country with so strong a dependence on commodity markets. Read more. (Subscription required.)

Wed., November 19, 2014

The parent company of Australia’s largest privately owned milk processing company, United Dairy Power (UDP) has been placed in receivership after its banker moved to remove its board and appoint a new CEO to manage its debts, The Australian reported. Insolvency firm PPB and the dairy company’s financier, Rabobank, appointed Marcus Derwin as managing director of Five Star United Food — which controls UDP — last week on the same day the dairy company was placed in receivership. It is understood the firms involved wanted to talk to the farmers that dairy supply the group before the news was made public. The receivership is unusual in that UDP and its subsidiaries will continue trading, while Mr Derwin will work to stabilise the parent company. Greg Quinn, Partner at PPB Advisory said: “The priority since our appointment has been to support UDP management and all its stakeholders including suppliers, customers and employees to stabilise the business. This has been successfully achieved and we’ve been encouraged by the positive response from key suppliers and customers of UDP. “UDP plays a key role in the local dairy industry, and through our appointment, we will endeavour to ensure that it continues to do so in the future.” The news comes only nine months after Hong Kong businessman William Hui paid about $70 million to take control of UDP from its founder Tony Esposito. Read more. (Subscription required.)

Wed., November 19, 2014

Ms Justice Marie Baker appointed Declan McDonald of PwC as interim examiner to Karen Millen Irl Ltd, Warehouse Fashion Irl Ltd and Coast Stores Irl Ltd following petitions by Rossa Fanning on behalf of the companies, the Irish Times reported. The court heard the companies have a reasonable prospect of survival if a number of conditions are met including renegotiation of rents and closure of uneconomic stores. The Karen Millen stores, employ 65 people, trade from nine different locations around the country and are either stand alone stores or are operated as concessions within the Brown Thomas chain. Warehouse Fashions operates from 16 locations, employing 106, and from stand-alone and concession stores. Coast, employing 129, also operates from 16 locations including concessions in Debenhams, Arnotts and House of Fraser. In their petitions, the companies say they traded profitably until the economic downturn in 2008 but difficulties continued as the economy declined with sales decreasing and onerous leases on premises remaining in place. Read more.

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