We were appointed over a number of companies in this group engaged in commercial property development and management based in Hong Kong and operating in Guangzhou. The Group’s property portfolio was valued over RMB6 billion.
The founder and chairman of the companies were detained by the PRC government for investigation of alleged crimes including obtaining illegal bank loans. The provisional liquidators had to deal with the relevant PRC banks and authorities to investigate these matters and at the same time deal with investors in the AIM market. This is described (by Caijin Magazine) as “one of the biggest fraud cases” in the PRC.
We were appointed by the Court as the Receivers to manage and operate a shopping centre consisting of 106 shops and 2 floors of parking spaces in Aberdeen. The shareholders of the companies owning these properties were in disputes as to who were the beneficial owners of these properties.
The shopping centre was valued at over HK$425 million and the amount of disputes between the owners was over HK$2 billion.
We are appointed as Joint & Several Liquidators, supervised and monitored the whole liquidation process; applying to court for regulating order because of the large number of creditors which was over 37,000; supervised closure of 11 outlets on Hong Kong Island, Kowloon and New Territories; investigated allegations of transfer of business and directors breach of duty.
This group of companies went into liquidation in the midst of the IT bubble, but was found to be involved in severe financial difficulties over substantial and complicated transactions and contracts with subsidiaries in Hong Kong, their securities arm and their PRC investments.
There were creditors claiming in total over HK$1.5 billion.
We, as Liquidators, supervised and monitored the whole liquidation process of over twenty subsidiaries, investigated and initiated legal actions regarding breach of duty of directors. We took action against one of the international “Big Four” firms for auditors negligence. Disposal of major assets were made in the group both in Hong Kong and the PRC, including Beijing, Chengdu and Harbin.
Disputes were between two extremely wealthy shareholders, one of which accused the other of fraudulent accounting and giving unfair advantage to certain customers of contract value. We were appointed as Provisional Liquidators and a report was prepared to the Court concluding whether there were fraudulent transactions.
The total customer contracts involved exceeded HK$9.3 billion.
We were appointed as the financial advisor to the Group listed on the Hong Kong Stock Exchange to advise them on a restructuring proposal to all their bankers regarding the Group’s debt due to these bankers. Over nine banks were involved and the total loan amount was over HK$1.3 billion. One of the hotels operated under the Group was in Receivership. The Group was threatened with petitions to wind up the Holding Company. However, the Group successfully survived after our participation in the negotiations with the banks.
We were appointed as Liquidators of a group of companies with various investments both in Hong Kong and the PRC. One of the subsidiaries of this group of companies held shares in a Joint Venture in Beijing specializing in buying, selling and development of traditional “Four Courtyards” houses in Beijing.During our appointment, this type of structures became very trendy and expensive in Beijing and the Chinese Joint Venture Party resisted to co-operate with the Hong Kong Liquidators in disclosing their business transactions and financial records. The Liquidators went to Beijing to negotiate and stroke a deal which resulted in disposing their shares in the Joint Venture.
This company boasted its sizeable shop as “the first cosmetic megastore in Hong Kong”, complete with hi-tech screens and decoration in one of the busiest districts in Hong Kong. However, the company collapsed at the end of the dot-com boom and we were appointed as Liquidators.
Shortly after our appointment, there were allegations against the directors for transferring the business of this company to director’s own business. We took action against one of the largest banks in Hong Kong and were successful and the Court ruled that the company’s debenture issued to that bank shortly before the company went into liquidation was invalid.
The Liquidators performed an investigation into both matters and a report was issued to the Official Receiver’s Office. We also assisted the Commercial Crime Bureau in their investigations.