Foreign Investors Bid for Non-Performing Assets

Home>>Business

Last updated at: (Beijing Time) Tuesday, November 20, 2001

Foreign Investors Bid for Non-Performing Assets

By November 19, three bidding teams consisting of seven overseas investors and domestic enterprises had submitted their application for tenders for five packages of Huarong's non-performing assets, said a spokesman from China Huarong Asset Management Corporation in Beijing.

Foreign investors bid for non-performing assets

The China Huarong Asset Management Corporation announced in Beijing Monday that well-known international investment banks have entered bids for non-performing assets under Huarong's management.

A spokesman for Huarong says that by November 19 14:00, the deadline for bids, three bidding teams consisting of seven overseas investors and domestic enterprises had submitted their application for tenders for five packages of Huarong's non-performing assets.

Significant: China first offers non-performing financial assets to international investors via the public bidding system

Huarong is the first among China's four AMCs to offer non-performing financial assets to international investors via the public bidding system. This move is widely seen as a significant step by China to accelerate the handling of huge amounts of non-performing financial assets bought by the AMCs from State-owned commercial banks. It is also thought as an easy way for international investors to enter China's financial market.

Bidding began in February this year when Huarong signed a contract for advice and trading services with Earnest & Young.

The spokesman says that Huarong has invited related supervising departments and social notary institutions to oversee the whole bidding process.

Succesful bidders will be announced within a month, he says.

total book value: US$1.8 billion, 356 enterprises involved

The five asset packages have a total book value of RMB15.6 billion yuan (US$1.8 billion), and involve 356 enterprises in the industries of real estate, construction materials, metallurgy, textiles, electronics, commerce, and chemicals, transportation and others, he says.

China huarong Asset Management Corporation is a 100% state-owned financial enterprise with an independent legal personality. The main scope of the Corporation covers the purchase, management, and disposal of the non-performing assets transferred from Industrial and Commercial Bank of China. The operational objective of the Corporation aims at taking advantage of the special legal status given by the state government to preserve the assets and to minimize the losses that shall be incurred.

Ernst & Young, one of the world's leading professional services organizations, helps companies across the globe to identify and capitalize on business opportunities. We aim to deliver innovative yet practical solutions, from concept through implementation and measurement. Ernst & Young's depth and breadth of service and our global reach mean that we have the resources to serve any client, anywhere in the world.

Foreign Investors Welcome to Buy Non-performing Assets in China