Chongqing Company Auctions Receivables Worth 98.27 Million Yuan, Sells for 28,500 Yuan

Chongqing Rongxun Supply Chain Management Co., Ltd. (Rongxun Supply Chain Company) had approximately 98.27 million yuan (RMB, hereinafter) of accounts receivable auctioned off recently, ultimately being sold for only 28,500 yuan, sparking discussions among netizens.

According to a report by Red Star News on April 14th, the auction notice revealed that Rongxun Supply Chain Company had a total of 10 accounts receivable, with a total debt amount of around 40.91 million yuan, and a total debt of about 98.27 million yuan after adding funds occupation fees and overdue fees.

The auction was related to the bankruptcy liquidation of Rongxun Supply Chain Company. In July 2024, the Fifth Intermediate People’s Court of Chongqing accepted the bankruptcy liquidation case of Rongxun Supply Chain Company filed by Chongqing Nantou Intelligent Terminal Investment Co., Ltd.

The auction notice stated that the above-mentioned assets were disposed of by the administrator in accordance with the “Bankruptcy Property Revaluation Plan” passed at the first creditors’ meeting of Rongxun Supply Chain Company and submitted to the court for approval to fulfill the administrator’s responsibilities in accordance with the law.

The auction started on April 10th, with a starting price of 1 yuan for the company’s accounts receivable and a deposit of 10,000 yuan, with a total of 9 bidders. After 40 rounds of bidding, it was finally sold for 28,500 yuan on the morning of April 11th.

The report mentioned that many companies that owed money to Rongxun Supply Chain Company are now in liquidation or deregistration status, with only one debtor in Beijing showing normal operations. The company with the largest debt is a technology company in Shenzhen, owing 18.6 million yuan, but the company was deregistered in November 2021.

Public records show that Chongqing Rongxun Supply Chain Management Co., Ltd. was established on March 6, 2014, with a registered capital of 200 million yuan, mainly engaged in leasing and business services, selling mobile phones and accessories, non-ferrous metal raw materials and products, etc., and is a wholly-owned subsidiary of Chongqing Rongxun Industrial Development Co., Ltd.

After this news was released, it sparked discussions among nearly 800 netizens on Tencent, with many expressing surprise at the low auction price and others questioning if there might be some hidden dealings behind the auction.

Netizen “Niu Zaifei” commented: “Is it possible that the debtor bought it for 30,000 yuan to avoid being pursued for debt, especially when the debtors in Beijing are still in operation.”

“Shiguang,” cynically remarked: “If the debtor buys it themselves, wouldn’t they be making a profit?”

“Tianyuxue” speculated: “It’s possible that a debt of over 10 million can be settled with just over 20,000.”

Netizen “Chou An” asked: “Is this kind of debt transfer legal? If this is allowed, then Evergrande owing money to banks could just follow suit and everything will be fine, right?”