Coming home: Chinese company pays investors in PIGS after the shortage of money
City & Finance Reporter for the Daily Mail
Chouying Agro-Pastoral Group investors have agreed to accept gifts for ham or pork instead of interest payments
Investors in a Chinese company are overloaded with meat after the company has no money left to pay them back.
Lenders who have £ 30 million in debt in Chuying Agro-Pastoral Group have agreed to accept gifts for ham or pork instead of interest payments.
The strange method is that the pork-producing company did not pay back £ 55 million in bonds this week, because the cash flow had been hit by outbreaks of African swine fever.
The remainder of the outstanding debt would be repaid in money, Chuying said, although these payments would be postponed.
Analysts reacted with raised eyebrows, but the shares of Chuying have increased by 20.9 percent since the announcement.
Perhaps investors were impressed by the quality of the meat – the gift packages sell for almost £ 1,000.
But Judy Kwok-Cheung, director of fixed income research at the Bank of Singapore, said: & # 39; Payment in kind is generally not considered acceptable for debt repayment. & # 39;
Chuying will not be the first company to pay back bonds with its products.
In 2010, Hotel Chocolat launched a Chocolate Bond.
Customers who invested £ 2,000 each year received six boxes of chocolate, each worth £ 18.95, until earlier this year, when the original sums were refunded in cash.