THREE China subsidiaries of mainboard-listed Anwell Technologies have defaulted on their loans totalling some HK$376 million (S$60.2 million).
The subsidiaries, Henan Sungen Solar Fab Co, Henan Kerry Digital Co and Dongguan Anwell Digital Machinery Co, have defaulted in the repayment of some of the term loans and revolving credit facilities granted by certain banks and financial institutions in China.
As a result of the default, the banks have obtained court orders for the seizure of assets against the group companies in default.
They include primarily land and buildings, plant and equipment.
This is to prevent the companies from disposing the assets, although they are still able to continue the use the seized assets for its daily business operations.
The total book value of the seized assets is about HK$1.8 billion as at Aug 31.
The interim management is currently negotiating with the banks for to reschedule payment of the defaulted loans and facilities.
Pending the outcome of the investigation, the banks have requested Anwell Technologies to settle the repayment of loan interests first instead of the immediate repayment of the principal amount due.
Meanwhile, two Hong Kong subsidiaries, Anwell Precision Technology (HK) and Umedisc (HK) have also defaulted on the repayment of bank loans granted by a bank in Hong Kong.
The amount due is HK$28 million.
Several of their top executives have been detained by the authorities in China they continue to investigate their role in a commercial deal involving a unit of the local government.