BRIEF: Neta parent Hozon starts bankruptcy restructuring
Hozon New Energy, has officially entered bankruptcy restructuring, reflecting troubles at its struggling Neta Auto electric vehicle (EV) brand. On June 13, the National Enterprise Bankruptcy Information Disclosure Platform revealed that Shanghai Yuxing Advertising Co. petitioned to have Hozon placed in bankruptcy, citing unpaid exhibition printing fees. The court accepted the case and appointed a bankruptcy administrator.
According to financial media Caixin, Neta’s Thai Facebook page posted a statement on June 12 saying the restructuring is a government-led, court-supervised effort to save the company. It plans to bring in strategic investors, restructure management and restart production, R&D, and its overseas expansion. However, a Thai supplier questioned the statement, saying the local team was dismissed by the end of May, and dealers and suppliers have suffered heavy losses.
Neta began missing its staff payments in the second half of last year, and has also been plagued by production halts and mass layoffs. Former CEO Zhang Yong stepped down last December, with Chairman Fang Yunzhou taking over. Fang has promised reforms and improved profit margins, but the company’s operations have not improved. Earlier this month, angry employees surrounded Fang and demanded unpaid wages. Hozon reportedly has nearly 10 billion yuan ($139.3 million) in debt. Previous plans for debt-to-equity swaps and new financing have made little progress.
By Lee Shih Ta
To subscribe to Bamboo Works weekly free newsletter, click here
