Chinese coal mining tycoon Xing Libin, who made the headlines last year after spending over $11 million (70 million yuan) on his daughter's wedding, is said to be nearly bankrupt and struggling with loans to the tune of $5 billion.
According to FT.com (subs. required), the situation is nothing but a reminder of the thin dividing line between China’s banks and its “shadow” lending industry.
Up to a few weeks ago Libin, 46, was known as the wealthiest man in the coal-rich county of Liulin and he made his fortune rather quick.
After starting out leasing a small rural coal mine in one of China's poorest provinces Shanxi, Xing Libin somehow managed to pay only the equivalent of $0.06 (6 US cents) per tonne for the 1.5 billion tonne resource at the county’s Xingwu coal mine.
Now his Liansheng Resources Group —a major player in China’s coal industry— and 12 subsidiaries will be reorganized, according to a judgment set down at a local court in Shanxi province, because Libin is unable to pay off loans, reports The Hong Kong Standard.
The paper says creditors include 10 private companies, trust firms and large state-owned banks, including Bank of Communications and China Development Bank.
Liansheng is only one of the several miners across the nation’s coal belt that have been seriously hit by a slow down in the country’s economy and plummeting commodity prices.
Image from liulin.gov.cn