Cross border distressed situations

Overview

Distressed situations wont’s always restrict themselves neatly to geographical borders; just like all other aspects of business, assets, operations and relationships can be distributed across multiple jurisdictions, including Mainland China and Hong Kong SAR.

We’re here to help address complex problems in onshore-offshore distressed situations and give you pragmatic advice and solutions.

You might be an offshore investor struggling to obtain recovery from an onshore (e.g. China) investment, or an onshore investor trying to obtain financial information from an offshore debtor company in financial distress, or a creditor who is inexperienced in dealing with cross border restructurings or insolvency.

Whatever your needs, we’ll use our extensive regional network, rich industry and market knowledge and our solid experience of achieving positive outcomes for clients, for you – so that you can start to take control again and reach reasonable compromises with your onshore or offshore counterparties.

Explore

Potential issues
Support
Our experience

Potential issues

Issues you may be facing:

your onshore operation is underperforming or maybe it’s in financial crisis due to mismanagement

your foreign debtor is in financial distress and may not be able to meet its repayment obligations and you want an independent view on what to do next

you want to take the right steps to realise, or obtain control over, onshore assets of an offshore debtor in financial distress

you want to hire a financial adviser to give you advice on your negotiations with foreign counterparties, such as debtors and creditors

you want to restructure a cross-border credit facility secured by onshore assets and which may involve onshore stakeholders

you want to engage an independent financial adviser to review the financial performance of a foreign debtor

you are losing control of your onshore business/operations

you want to petition for the parallel liquidation of a debtor company in two separate jurisdictions.

Support

When it comes to cross-border distressed situations our experienced and dedicated team can:

provide interim management of onshore operations to quickly stabilise the business

conduct tailored financial reviews on an onshore/offshore debtor and give you clear advice on what to do next, whether that’s restructuring, receivership or liquidation

coordinate the restructuring efforts and stakeholder communication in multiple jurisdictions

help seize, and maintain control of, onshore assets when necessary

identify appropriate routes to exit an investment in a foreign jurisdiction, and take care of negotiations with counterparties, communication with local government and regulators

negotiate leverage for international creditors through litigation in PRC courts

use secondary markets to optimise existing investors’ exit

act as liquidators or receivers in parallel enforcement actions in different jurisdictions to get the best recovery for investors.

Our experience

Suntech Power Holdings Co., Ltd

Initial financial review for offshore institutional bondholders. Coordinating restructuring for stakeholders in the PRC, US and Europe under a Cayman Island provisional liquidation framework.

Obtaining US recognition by progressing a US Chapter 15.

Safeguarding creditors’ interest.

Preserving PRC assets.

Total debt size: US$500 million

The biggest thermal coal mining company in Indonesia

Acting as financial adviser of an onshore bank creditor.

Reviewing the financials and providing comments on the financial implications of the proposed debt restructuring.

Total debt size: US$3.8 billion

Rightway China Real Estate Ltd

Initial financial review for offshore institutional bondholders (the ‘Bondholders’).

Appointed by the Bondholders to act as receivers.

Obtaining and maintaining control of onshore assets.

Initiating PRC litigation to maximise Bondholders’ bargaining power.

Existing Bondholders’ exit optimised through the secondary market.

Total debt size: US$700 million

Wongs Investment Holdings Group Limited

Acting as the liquidators of the company in Hong Kong and BVI.

Securing and realising the assets, including majority equity interest in a subsidiary listed on the HK Stock Exchange.

Working closely with stakeholders to manage the realisation process.

Asset size: Over HK$200 million

Lehman Brothers International (Europe) (LBIE)

Monetising the stocks and securities held by LBIE’s QFII in China and thereafter repatriating cash proceeds from China to the UK.

Dealing with all necessary regulatory clearances.

Managing the first significant QFII exit and cash repatriation.

Portfolio size: US$1 billion

FerroChina Limited

Acting as receivers appointed by foreign creditors.

Working with the PRC bankruptcy reorganisation administrator to deal with cross-border restructuring and protect foreign creditors’ interests.

Total debt size: Over US$290 million in offshore debt and over US$700 million in onshore debt

Pacific Andes Group

Acting as independent reporting accountants to assess the latest financial position and business performance of the major overseas subsidiaries of the group.