Antong Holdings, a major domestic container shipping operator in China, has announced that a court has ruled to restructure subsidiaries Antong Logistics and Ansheng Shipping at the request of creditors due to the company’s inability to repay debts.
The company has been suffering from a financial crisis and dozens of lawsuits after an illegal guarantee scandal involving the company’s former chairman Guo Dongze were disclosed. Total liabilities of the Guo brothers, the controlling shareholders of Antong, amount to RMB8bn ($1.1bn).
The Guo brothers jointly control 54.32% shares in Antong Holdings and the shares are currently frozen by courts.
Antong Holdings said the company will actively coordinate with the court and the administrator to proceed with the restructuring but it is still facing the risk of being declared bankrupt.
A source told Splash that it is very likely that China Merchants will take over Antong due to the strategic relations recently formed by the two groups. In September, Antong Holdings entered into a strategic framework agreement with China Merchants Port Holdings and AVIC Trust to start a series of collaborations. Under the agreement, the three parties will set up joint venture China Merchants Antong Logistics Management Company, with China Merchants Port and AVIC Trust providing RMB50m ($7m) and RMB200m ($28m) loans to the jv respectively.
AVIC Trust will also set up a trust fund to provide supply chain financing services to Antong Holdings.
Following the signing of the strategic agreement, the Guo brothers both quit the management of Antong and the board of the company appointed Zheng Shaoping, vice general manager of China Merchants Port Holdings as the new chairman.
According to Alphaliner data, Antong currently operates 117 ships with total capacity of 146,734 teu, making it the second largest domestic shipping companies in China following Zhonggu Logistics Corporation.