A spokesman with China's state assets watchdog said in Beijing on January 28 that the State-owned Assets Supervision and Administration Commission (SASAC) will not bail out China Aviation Oil (Singapore) Corp.

Du Yuanquan said the CAO restructuring plan was submitted to the Singapore High Court on Monday. The Singapore-listed company, which suffered a massive loss in derivatives trading, is now seeking investors who are interested in helping the company.

In line with laws of Singapore and international business practice, Du said, the company is looking for an appropriate solution, which might settle the debts and minimize deficits.

As owner of China Aviation Oil Holding Company (CAOHC), which parents CAO, the SASAC will ask CAO to abide by rules in restructuring the company, but will not directly engage in the bailout plan, Du said.

Du said the SASAC hopes the CAO restructuring plan would be understood and accepted by its creditors.

Singapore's state investment vehicle Temasek Holdings is willing to participate in the restructuring.

Du said his commission are now closely following up the development of the case. He also said the SASAC will thoroughly investigate the loss and punish those responsible accordingly.

Du urged other big state companies to draw lessons from the CAO case and strengthen their own inner check mechanism.

Source: Xinhua