HEADLINE: Guangnan, GDI debt restructuring talks progressing smoothly

Guangnan (Holdings) Ltd chairman Kang Dian said negotiations with creditors on the restructuring of the debts of Guangnan and Guangdong Investment (GDI) are progressing smoothly and that an agreement will be reached soon.

Kang is also deputy chairman for GDI. Guangnan and GDI are the two flagship companies of Guangdong Enterprises (Holdings) Ltd, which is facing financial difficulties.

Speaking after Guangnan's AGM, Kang said the company is relying on "policy support" from the Guangdong provincial government to carry out limited operations on credit.

The provincial government does not provide financial support to Guangnan, he said, adding that the company cannot resume its normal business until the debt restructuring is complete.

"Both sides have agreed that it will not take too much more time for an agreement to be reached," Kang said. But he added that it is difficult to predict when that will happen.

Kang said Guangnan has appointed Li Li as its executive vice chairman and Liu Zhongsheng as its director and general manager.

Kang said the two new directors will help to strengthen the management of the company.

The company is now drawing up a 5-year plan and will be focused on food-related businesses, Kang said, adding that the implementation of the plan will have to wait until after the debt restructuring.

He said the operating environment has been tough for Guangnan in the first half, but added that the company will continue to streamline its operations.

He said a special team set up last year to collect receivables is carrying out a very difficult task, but added that the provisions it will make this year for unpaid receivables will be lower than previously.

At 11:54 am, Guangnan was unchanged at 0.31 hkd and Guangdong Investment was unchanged at 1.04.