China Faces Biggest State Firm Offshore Debt Failure in 20 Years
- Tewoo Group’s distressed debt plan is the first of its kind
- The Tianjin firm has $2.05 billion of outstanding dollar bonds
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A major Chinese commodity trader looks poised to become the most high-profile state-owned enterprise to default in the dollar bond market in over two decades. In a fresh sign that Beijing is more willing to allow failures in the politically sensitive SOE sector, Tewoo Group has offered an unprecedented debt restructuring plan that entails deep losses for investors or a swap for new bonds with significantly lower returns.
Tianjin-based Tewoo Group Co. is owned by the local government and operates in a number of industries including infrastructure, logistics, mining, autos and ports, according to its website. It also has footprints in countries including the U.S., Germany, Japan and Singapore.