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Many enterprises cancel or postpone debenture offering on Chaori debt default

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2014-03-07 GMT+8:00

BEIJING, Mar. 7 (Xinhua) – Many enterprises canceled or put off theirofferings of commercial papers or mid-term notes under the heavy blow dealt by Chaori debt default event.

Shanghai Chaori Solar Energy Science &Technology Co., Ltd. (002506.SZ) announced Tuesday that it failed to solve itsliquidity crisis and financing from outside channels also turned out useless,making payment for interest on its 5-year fixed-rate note on this Fridayimpossible.

Chaori debt default shattered the zero bond default legend in China's bond market and heavily shattered the primary and secondary debenture market, which gave rise to the intensive cancellation or put-off of bond offering plans.

On Thursday, seven enterprises announced on the website of www.chinamoney.com.cn that they would cancel or postpone their original debenture offering plan, including five batches of mid-term notes and two batches of commercial papers. Previous on Wednesday, three enterprises made the similar announcement.

According to their announcements, some enterprises changed their plansout of insufficient subscription funds, while others did so out of the volatility in bond market.

Insiders noted that since Chaori solar brokethe myth of no default in China's bond market, investors' risk aversion sentiment kept rising, which severely dampened institutions' bond subscription enthusiasm on the primary market and drove up yields on the secondary market. Hence, it was not surprising to see the booming of auction plan changes. (Edited by Zhang Yuan, zhangyuan11@xinhua.org)

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