Chinese state brokerage Everbright Securities Company Limited. Two former Italian owners of British sports media company MB & Silva (MPS) have been prosecuted for fraudulent misrepresentation and breach of tax obligations.
The unit of Everbright Capital Investment Limited, Jinxin Inc foreign investment of Everbright Capital sued the High Court of London in England and Wales for compensation of $ 661 million (4, 2 billion yuan). Everbright is trying to get some back Big losses incurred due to the unfortunate acquisition of MPS in 2016.
The Italian MPS founders are two prominent figures in the sports and sports media. Riccardo Silva, 51, is the owner of Silva International Investments and president of Miami FC, while Andrea Radrizzani, 46, is the owner of English football club Leeds United and head of television group Eleven Sports.
Everbright Capital was part of a consortium that bought 65% of MPS for 5.2 billion yuan. The deal came at a time when Chinese companies were struggling to acquire foreign companies, which later turned out to be a failure. Everbright Capital invested 60 million yuan, while major partners including China Merchants Bank Co., Ltd. and Shanghai Huarui Bank Co., Ltd. most of the financing.
After a series of lost rights payments to major sports organizations, Mohammed bin Salman was declared bankrupt and liquidated in October 2018. Everbright Capital ended up owing billions of yuan to two major consortium partners, according to their financing agreement. Everbright Capital has agreed to compensate if the major partners are unable to “get out of the investment.”
As of May 2019, Everbright Capital lawsuit from China Merchants Bank and Shanghai Huarui Bank to compensate for 3.5 billion yuan. An Everbright executive told Caixin that the rulings do not mean the company will assume related liability or waive its rights in connection with the lawsuits.
Investment failure and subsequent financial disputes led Everbright Securities to set aside 1.4 billion yuan of bad debt provisions in 2018 and 1.6 billion yuan in 2019. The deal continues to undermine the company as it set aside others. 1.55 billion yuan of bad debt in the 2020 investigation with many senior executives or their resignations due to their role in the deal.
Communications Editor Bob Simpson ([email protected])
Download Our app for getting breaking news alerts and reading news on the go.
Follow the Chinese markets in real time with the new Caixin Global’s stock database.
You have accessed an item only available to subscribers
“Introvert. Avid gamer. Wannabe beer advocate. Subtly charming zombie junkie. Social media trailblazer. Web scholar.”