China's Tsinghua Unigroup says creditors call for restructuring

SHANGHAI, July 9 (Reuters) - China’s Tsinghua Unigroup said on Friday that it had received a notice from a Beijing court saying that its creditors have called for a restructuring of the indebted chip conglomerate.

The development at Tsinghua Unigroup, which is 51% owned by China’s Tsinghua University and led by former real estate mogul Zhao Weiguo, comes after its debts mounted following a string of acquisitions which failed to deliver meaningful profit.

Tsinghua Unigroup said in a statement on its social media account that its creditors had told the court that it cannot pay off its debts and that its existing assets are not of sufficient value to compensate for the lost value.

It said it “will fully cooperate with the court to conduct a judicial review in accordance with the law, actively promote debt risk mitigation and support the court in safeguarding the lawful rights and interests of creditors”.

Tsinghua Unigroup positioned itself as a key player in Chinese efforts to boost its chip sector, at one point trying to buy U.S. memory chip maker Micron Technology.

As of June 2020, it said it had $31 billion in debt and just $8 billion in cash and cash equivalents. By the end of 2020, the company had defaulted or cross-defaulted on onshore and offshore bonds worth about $3.6 billion. (Reporting by Josh Horwitz; Editing by Alexander Smith)