Is swapping cash for ham a legitimate revenue?
Friday, November 9, 2018 – 3:01pm
A debt paid off in ham — too good to be true, or a total ham scam?
In order to make up for 271 million yuan, or around £30 million pounds, of debt, a Chinese pork producer is now paying its bondholders in ham or pork gift packages instead of interest payments.
The company decided to deal in ham instead of money because orders had dried up due to outbreaks of a highly contagious African swine fever, according to Reuters.
“The currency funds are deferred and the interest is mainly paid by the company’s ham, ecological meat gift [boxes] and other products,” said Chuying Agro-Pastoral Group Co. in its report filed to the Shenzhen Stock Exchange on Tuesday. “The scope includes all existing debts of the company.”
Judy Kwok-Cheung, director of fixed income research at Bank of Singapore, told Bloomberg the company’s situation illustrates the growing concerns around liquidity issues facing small and medium Chinese businesses.
“Payment in this kind is generally not seen as acceptable for debt repayment,” Kwok-Cheung said.
Perhaps disapproving investors can resell their ham revenue. A gift package from Chuying Agro-Pastoral costs 8,999 yuan, or close to a thousand pounds, reports Bloomberg.
Yicai Global, a Chinese news blog, reports the strategy is “only a preliminary plan and the ham is yet to be delivered, as a concrete deal is still under discussion.”
China …read more
Source:: The Week – All news