Moulin Global Eyecare in big trouble with banks

Moulin Global Eyecare Holdings, the world's third-biggest eyewear maker, said Tuesday that 16 banks were seeking loan repayments totaling 946 million Hong Kong dollars.

Moulin was in talks with the banks about a standstill in debt payments and was awaiting the results of a study by Anglo Chinese Corporate Finance into the possible sale of assets or shares, and the introduction of new investors, the company said in a statement to the Hong Kong stock exchange. The repayments sought by the banks are equivalent to $122 million.

The eyewear maker, controlled by the family of chairman Ma Bo Kee, in April scrapped a 321 million-dollar sale of convertible bonds. Moulin's auditor resigned at the same time after the company disclosed accounting errors following last year's purchase of Eye Care Centers of America, the second- largest U.S. optical chain.

Moulin has total debt of 5.3 billion dollars. Its shares have been halted from trading since April 18th.

'With the forbearance of its bank creditors and continued financial support of the Ma family, the company has sufficient working capital for its short-term operational needs', Ma said in the statement. Talks with potential new investors in Moulin were 'at an early stage', he said.

Moulin, which on June 1st said it had four mortgage loans and no assets pledged as collateral for borrowings in Hong Kong, on Tuesday said it had five mortgage loans and had pledged a cash deposit in China as security for loans.

The discrepancies were because of an 'oversight', Ma said. 'A lot of resources have been diverted to negotiations of the standstill agreement with bank creditors'.

Moulin said its NiGuRa Metzler Optik unit intended to file for insolvency because it was unable to pay debts. This might affect the company's operations, it said.

Moulin had received a demand from a money lender seeking repayment of 50 million dollars on May 30, it said. The company was contesting the amount claimed and had asked a court to declare the loan invalid and unenforceable.

Two independent directors, Ivan Chan and David Ng, had resigned with effect from June 8, following the resignations on May 13 of two executive directors, Dennis Ma and Joseph Barrett, Moulin said. The company's 2004 results remained delayed until further notice.

(Source: Bloomberg News)