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May 17, 2018 7:34 pm | FILED UNDER: business

Zeman’s China Partners Fail To Pay Debt – Kicked Off CEFC Board

By ČTK Milos Zeman Ye Jianming

Prague, May 17 (CTK) – Chinese group CEFC China Energy has failed to pay its debts to J&T Private Investments (JTPI) in time, so J&T has taken over shareholder rights in CEFC Europe, dismissing its board and appointing a crisis management, JTPI spokesman Petr Malek told cTK today.

 

CEFC China Energy owes EUR450m (Kc11.5bn) to the Czech group.

 

CEFC Europe Group spokesman Pavel Bednar told CTK the company would not comment on J&T’s information.

 

The dismissed board members include board deputy chairman Jaroslav Tvrdik, who has said recently Chinese state conglomerate CITIC Group will pay CEFC’s debts within days.

 

Creditors have negotiated with CITIC representatives, but have not found a solution, Malek said.

 

“In addition, JTPI has been informed recently that CEFC is taking steps aimed at preventing creditors from exercising their rights,” Malek said.

 

New board members of CEFC Europe are Peter Kubik and Dusan Palcr.

 

The crisis management is expected to secure stability of all parts of the CEFC Europe group and to create conditions for solving the situation, Malek said.

 

A financial and legal audit will be carried out in CEFC Europe, J&T said.

 

“The creditors are ready to hold talks with CITIC, which they consider a trustworthy and transparent partner,” Malek noted.

 

All receivables of J&T Finance Group (JFTG) from CEFC are secured by quality assets and JFTG has no reason to adopt any measures at this moment, spokeswoman Monika Vesela told CTK.

 

“The situation has no influence on the operation and financial results of JTFG. We believe that the crisis management will also help solve the problems of the parent company, among other things,” she added.

 

Information about CEFC’s financial problems emerged following reports that CEFC group head Ye Jianming is being investigated by Chinese authorities on suspicion of having committed an economic crime.

 

CEFC’s debts are pledged by the building of the former Zivnobanka bank in the centre of Prague, the Florentinum administrative complex and the Slavia soccer stadium, among other things.

 

CITIC Group has recently acquired 49 percent in CEFC Europe.

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