Xinxiang, Henan — Administrators at financially troubled Chinese refrigerator maker Frestec have ordered the company to sell assets to meet creditors' demands. The company continues to trade normally.
The court-appointed administrator has started the auction process for a number of Frestec sites on online auction service Alibaba. Lots in the auction include some of the company’s subsidiaries. Real estate is also expected to be auctioned.
The auction of three of Frestec’s appliance subsidiaries is slated to begin in late June. The assets have a starting price of CNY 450m ($70m). Part of the company’s land and real estate assets will also be auctioned in July. The starting price for these is CNY 115m.
Previously, Frestec had found an investor for its reorganisation – its major shareholder Hong Leong Asia, a Singaporean business in consumer appliance, industrial equipment and building materials. Hong Leong Asia backed out in April.
According to a stock exchange filing by creditor Kasun, if the asset sale is successful then creditors will receive 18% of their outstanding debt.
If the company becomes bankrupt, Kasun said, creditors can expect 1.5% of their outstanding debt.
