Major Chinese Chip Company Defaults on Debt

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Even as China spends heavily to nurture its semiconductor industry, a flag-bearer for the initiative has run into trouble with its debts

Tsinghua Unigroup Co., a key player in China’s push for self-reliance in semiconductors, has defaulted on a bond, adding to a recent spate of trouble in the country’s corporate debt markets.

China Chengxin Credit Rating Group said late Monday that Unigroup was in default on the privately placed domestic bond, worth 1.3 billion yuan, equivalent to $197 million. The ratings company said Unigroup had failed to reach agreement with creditors to extend the repayment deadline. Chengxin cut Unigroup to triple-B—a grade that signals a high degree of risk in the Chinese credit-rating system—and said the default could trigger cross-defaults on some other Unigroup debt. Unigroup didn’t respond to requests for comment.

 

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Rubber vs Sand!

Similar to what happened to some American companies in the early decades of the 20th century. Capitalism knocks out the weak or the ill informed.

it needs to die so others can utilise its resources more effectively

wow

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