Peace Mark sold

More than two months after it was appointed as liquidator for Peace Mark (Holdings), workout specialist firm Ferrier Hodgson has sold the watch retailer to Chow Tai Fook Jewellery for HK$505m (US$64.7m).

The watch maker went into liquidation in early September after Peace Mark’s announcement on September 3 that it was unable to repay debts of about HK$1.22bn. The group also said that it had received indications from other lenders that they would demand the repayment of HK$186m debt.

A separate public bidding process is ongoing for the sale of Sincere Watch, which was acquired by Peace Mark earlier this year. When Peace Mark went into liquidation, Sincere Watch was hived off and allowed to continue business as normal. About half a dozen private equity and trade buyers are said to have been shortlisted for Sincere Watch with final bids due by December 12.

TT International has won the dubious honour of being the first issuer to default on a Singapore dollar MTN programme. The consumer electronics trading and distribution company missed a S$2m payment due on the Series 18 notes on October 30, and declared an event of default on November 7. That in turn prompted a cross-default on all its debt, comprising a S$250m MTN programme, a S$50m MTN programme and a US$33m loan facility.

Negotiations with its creditors are under way to restructure its debt. At the same time, the company said it would apply a standstill of repayment of amounts to all principal bankers and all other unsecured creditors. These however will exclude trade creditors that are needed to ensure that its day-to-day operations will continue.

It has hired Tan Corporate Advisory as its financial adviser and WongPartnership as its legal adviser. The bulk of the S$250m MTN programme, set up by DBS in April this year, were issued in variable rate notes to meet working capital and general corporate purposes.

TT International does not hold out much hope that a white knight will come to the rescue. It wryly observed: “most potential strategic investors [are] withholding their investment decisions in view of the present financial crisis”. But it is hopeful that advanced talks with a potential strategic equity partner to develop the warehouse retail scheme will pan out soon.