Shanshui Cement unit defaults on third onshore bond, China

Shanshui Cement's key operating subsidiary Shandong Shanshui Cement Group defaulted on its third onshore bond.

According to a statement posted on Shanghai clearing house on 14 February, Shandong Shanshui could not pay in full of the bond's principal and coupon due on February 12 because some of its banks accounts and assets were frozen due to lawsuits against the company.

The principal and coupon totaled CNY826.56m (US$126m). A spokesman for Hong Kong-listed Shanshui said its largest shareholder, Tianrui Group, has provided an interest-free loan to the company to make coupon payments and related fees for the onshore bond. However, repayment of the principal of the bond, which amounted CNY800m, still needs further negotiation with creditors.

Shandong Shanshui earlier defaulted two onshore bonds, including a CNY2bn bond due 12 November  2015 and a CNY1.8bn bond due on 21 January 2016.