UPDATE 1-Krispy Kreme HK creditors to meet, seek liquidation

Mon Oct 27, 2008 2:15am EDT

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HONG KONG Oct 27 (Reuters) - U.S. chain Krispy Kreme Doughnuts Inc's (KKD.N) Hong Kong franchisee has appointed Briscoe & Wong Ltd as independent financial advisers to help it find liquidators, as it becomes the latest company in the city to close amid the global financial crisis.

Briscoe said in a statement on Monday a creditors' meeting would be held on Nov. 12 to seek liquidators to deal with the assets of Krispy Kreme Hong Kong and the claims of its employees and creditors.

It has seven stores in Hong Kong and five will be closed immediately. The two outlets at the Hong Kong International Airport will continue to trade until further notice, it said.

"The directors are very disappointed that they have had to take this action," it said.

Earlier this month, the U.S. sweet treats chain said it agreed with KKD Lotte Holdings Co to open 35 Krispy Kreme retail locations over the next four to five years in China's major cities, including Shanghai, Beijing and Tianjin.

Lotte is Krispy Kreme's franchisee in South Korea and Japan.

Kispy Kreme has struggled in recent years with restatements, investigations into its past accounting and a decline in doughnut sales that sent some of its franchisees into bankruptcy. (Reporting by Alison Leung; Editing by Anne Marie Roantree)

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