1. Economic/Value Destruction Default
A. China
HNA Group (2021)
- Aggressive global expansion led to unsustainable debt
- Core aviation business destroyed by COVID-19
- Failed diversification into unrelated businesses
- Shows how rapid expansion without core competency leads to value destruction
Anbang Insurance (2018)
- Aggressive overseas asset purchases at premium valuations
- Insurance premium funded investment model collapsed
- Government takeover after value destruction
- Demonstrates how regulatory changes can destroy business models
B. India
Jet Airways (2019)
- Market share erosion from low-cost carriers
- Unable to maintain premium positioning
- Cost structure became unsustainable
- Shows how competitive disruption destroys value
Kingfisher Airlines (2012)
- Failed acquisition of Air Deccan
- Inability to manage dual-brand strategy
- Fuel cost volatility impact
- Illustrates how poor strategic decisions accelerate value destruction
C. Indonesia
Garuda Indonesia (2021)
- Legacy cost structure
- Government support masked fundamental issues
- COVID-19 exposed structural weaknesses
- Shows how state ownership can delay but not prevent value destruction
Bakrie Group Companies (Multiple Defaults)
- Commodity price exposure
- Complex cross-holdings
- Natural resource depletion
- Demonstrates cyclical industry risks
D. Singapore/Hong Kong
Pacific Andes (Hong Kong/Singapore, 2016)
- Fishing quota restrictions impacted core business
- Supply chain breakdown
- Working capital cycle collapse
- Shows how regulatory changes can destroy business value
Hyflux (Singapore, 2019)
- Technology bet on membrane technology
- Change in government power purchase agreements
- Infrastructure project delays
- Illustrates how public-private partnership risks can destroy value
2. Value Diversion Default
A. China
China Huarong (2021)
- Related party transactions under Lai Xiaomin
- Asset quality manipulation
- Complex shadow banking operations
- Shows state-owned enterprise governance issues
Founder Group (2020)
- University-linked conglomerate
- Complex ownership structure enabled diversion
- Related party transactions with Peking University
- Demonstrates public institution governance challenges
B. India
Videocon Group (2018)
- Related party loans
- Cross-collateralization across group
- Promoter pledging issues
- Shows promoter group complexity issues
Bhushan Steel (2017)
- Promoter fund diversion
- Letter of credit fraud
- Related party transactions
- Illustrates traditional business group issues
C. Hong Kong/Singapore
China Fishery Group (2016)
- Related party transactions with Pacific Andes
- Transfer pricing issues
- Complex cross-border structure
- Shows how listed company structures enable diversion
Brightoil Petroleum (Hong Kong, 2019)
- Trading losses hidden through related parties
- Margin funding through complex structures
- Asset transfers to related entities
- Demonstrates opacity in trading businesses
3. Temporal/Liquidity Default
A. China
Kaisa Group (Multiple Defaults)
- Maturity mismatch in land banking
- Regulatory changes affected pre-sales model
- Cross-border funding challenges
- Shows Chinese property developer funding model risks
CITIC Guoan (2020)
- Short-term debt funding long-term investments
- Pledge share financing risks
- Conglomerate structure complicated refinancing
- Illustrates Chinese conglomerate liquidity risks
B. India
DHFL (2019)
- Asset-liability mismatch in housing finance
- Wholesale funding dependence
- Market confidence loss spiral
- Shows non-bank finance company risks
Reliance Communications (2017)
- Technology investment timing issues
- Spectrum payment obligations
- Working capital cycle breakdown
- Demonstrates telecom sector timing risks
C. Singapore/Hong Kong
MAS Holdings (Singapore, 1985)
- Pan-Electric Crisis
- Forward contract obligations
- Market closure impact
- Historical case showing systemic risk
Peregrine Fixed Income (Hong Kong, 1998)
- Asian financial crisis impact
- Indonesian exposure
- Short-term funding model
- Shows investment bank liquidity risks
Asian Cross-Cutting Themes
1. Business Group Structures
- Family-controlled conglomerates common
- Complex cross-shareholdings
- Internal capital markets
- Multiple listed entities
2. State Involvement
- Direct ownership influence
- Policy-driven lending
- Implicit guarantees
- Regulatory relationship management
3. Relationship-Based Banking
- Connected party lending
- Group-based credit assessment
- Informal workout preferences
- Personal guarantee reliance
4. Corporate Governance Patterns
- Concentrated ownership
- Related party transactions
- Minority shareholder issues
- Board independence challenges
5. Regional Variations
China
- State ownership influence
- Policy-driven defaults
- Cross-border complexity
- Property sector concentration
India
- Promoter group issues
- Public sector bank dominance
- NCLT resolution process
- Group guarantee complications
Southeast Asia
- Family business groups
- Cross-border operations
- Currency mismatch issues
- Different legal frameworks
6. Industry Patterns
- Property developers: Timing mismatch
- Commodities: Value destruction
- Financial services: Information asymmetry
- Manufacturing: Working capital issues
7. Resolution Frameworks
- China: State-led resolution
- India: IBC process
- Singapore: Scheme of arrangement
- Hong Kong: Provisional liquidation
8. Creditor Behavior
- Domestic bank syndication
- International bond markets
- Trade credit patterns
- Informal workouts preference
9. Information Quality
- Related party disclosure
- Audit quality variations
- Regulatory reporting
- Market communication practices
10. Cultural Factors
- Face-saving reorganizations
- Group loyalty influence
- Relationship preservation
- Social impact consideration
