Creditors want more from CAO

The state-owned parent of scandal-hit China Aviation Oil (Singapore), which sought court protection with debts of about US$530m, may have to pay more cash to prevent creditors from pushing the jet fuel trader to bankruptcy. CAO has offered to pay the company's 98 creditors 41.5 cents on the dollar, but more than half of the debt will be paid over eight years. London-based Standard Chartered is one of at least three creditors so far to have rejected the offer. Another bank, Singapore-based Overseas Chinese Banking Corporation, which is owed US$15m, told Bloomberg the offer was "a good starting point for further negotiations between all the creditors and CAO." Creditors have said they are looking to the parent company, China Aviation Oil Holding, for additional money because the Singapore-listed unit's assets are insufficient to repay its debt. China Aviation Oil had net assets of $137 million, according to the 2003 annual report. Creditors have been offered $100 million up front and $120 million to be paid over eight years.