Receiverships

Overview

If a company fails to repay its debts, one enforcement remedy available to secured creditors is receivership. When an independent third party is appointed as receiver they can recover outstanding amounts by taking possession of any secured assets and realising them, in order to repay the outstanding debts of secured creditors.

A receiver can be appointed by either the secured creditor, acting under the terms of a security agreement, or by the Court under an application by the secured creditor.

If considered appropriate, a secured creditor or the Court may also appoint a receiver manager to run the business and preserve its value until it is sold as a going concern. 

 

 

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Potential issues

As a secured creditor, you may find you face a number of obstacles when managing your exposure in mainland China or Hong Kong, including but not limited to: 

  • uncooperative directors and/or management of the debtor company
  • a breakdown in confidence in management’s ability to address the present challenges
  • the emergence of fraud
  • dissipation of company assets.

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Support

A receiver can protect and preserve the company’s assets, and assess the company’s position to determine the best course of action.

Our team of recovery experts in China and Hong Kong has significant experience in advising and assisting clients on the best debt recovery efforts in troubled situations. We have helped secured creditors by:

  • being the catalyst to force recalcitrant directors and/or management to the negotiating table
  • obtaining access to the company’s books and records
  • protecting property to prevent any asset dissipation
  • determining the value of the company’s assets
  • dealing with any troublesome third party creditors and stakeholders
  • steering the company through difficult litigations
  • running a professional and thorough sales process to maximise asset recovery.

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Our experience

  • Appointed as receivers by a consortium of lenders for a Mauritian special purpose vehicle (SPV) with assets in multiple, complex jurisdictions including India, Iraq, Libya and USA.
  • Appointed as receivers and managers of a Chinese real estate group with assets worth more than USD2 billion.
  • Appointed by the Hong Kong Court as receivers over multiple Hong Kong bank accounts containing USD1.5 billion in complex derivative securities.
  • Appointed as receivers of Hong Kong Minibonds with a nominal value of USD1.5 billion.
  • Appointed as receivers of FerroChina with debts of USD1 billion.
  • Appointed as receivers of a Hong Kong-listed, Chinese property developer.

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Contact us

Ted Osborn
Restructuring and insolvency Leader
Tel: +[852] 2289 2299
Email

Victor Jong
Partner
Tel: +[86] (21) 2323 3650
Email

Christopher So
Partner
Tel: +[852] 2289 2577
Email

Marie Rowbotham
Director
Tel: +[852] 2289 2504
Email

Chris Chin
Director
Tel: +[852] 2289 2530
Email

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