Furthermore, Asia Aluminum incurred a considerable drain on its cash resources due to the construction of its flat rolled products facility.
[1] In March 2009, the company began liquidation proceedings in Hong Kong after management withdrew its tender offer for the Senior and PIK Notes.
When attempting to gain control of the company's mainland China subsidiaries, employees of FTI Consulting reported that both management and staff had been uncooperative.
In view of this threat, FTI Consulting negotiated a non-exclusive agreement with limited terms to sell 100% equity in Asia Aluminum's PRC operating assets to a management buyout consortium.
This structure allowed for the potential advent of a superior offer from another party and the ability of the Provisional Liquidators to secure information from management, which had not been forthcoming, on the onshore assets.
Despite significant media coverage of the sale, no other firm bids were tendered for Asia Aluminum's PRC assets.
As is characteristic of bankruptcy situations in China, a majority of Asia Aluminum's investors were unable to fully recoup their investments, and its management team now owns the US$2.4 billion business.