Creditors of Chinese textile and fashion company Shandong Ruyi Technology Group have announced the firm has defaulted on a loan used in the purchase of Lycra Co, the stretchy-fabric company, and that they would be looking to gain control of the US-based Lycra, reports The Wall Street Journal.
The move is the latest financial challenge for Ruyi, the company stitched together by textile magnate Qiu Yafu, who had promised to challenge the likes of LVMH Moët Hennessy Louis Vuitton as a global luxury conglomerate. After a flurry of acquisitions in recent years, Ruyi has retrenched. Some of its creditors have moved to wrest control of brands Ruyi bought.
Creditors related to the Lycra deal include Hong Kong-based finance company China Everbright; Lindeman Asia Investment and Lindeman Partners Asset Management, both South Korean private-equity and asset management firms specializing in cross-border deals; and Tor Investment Management, a Hong Kong asset-management firm.