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A GROUP of creditors is demanding the liquidation of Elegant Jade Enterprises, a wholly-owned subsidiary of Chinese property developer Sunshine Holdings.
Centar Investment (Asia), Stark Master Fund and Stark Asia Master Fund have applied to the British Virgin Islands courts for an order to appoint liquidators for Elegant Jade.
Sunshine Holdings said yesterday that Elegant Jade is seeking legal advice and intends to contest the application.
The three investment funds which filed the application are part of a syndicate which lent US$120 million to Sunshine Holdings. Their share of the loan is around 21 per cent, or US$25 million.
The developer had breached certain financial covenants under the loan agreement and is working on a plan to restructure the debt.
Acting separately from other members of the syndicate however, the three investment funds sent Sunshine Holdings a letter of demand in May, asking for the immediate payment of all outstanding debts owed to them.
Sunshine Holdings said then that the demand letter would complicate restructuring negotiations.
In response to the three funds' latest move, Sunshine said that it will 'take all necessary actions to ensure that its restructuring efforts are not compromised or derailed'.
It added that it is still in discussion with other members of the syndicate to agree on a restructuring plan.
Last week, Ernst & Young submitted a preliminary financial review on Sunshine Holdings to the latter's creditors.
Sunshine Holdings lost half a cent yesterday to close at three cents.
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