HONG KONG: Chinese dairy products maker Taizinai, which counts Goldman Sachs and Morgan Stanley among its investors and Citigroup among its lenders, has collapsed, leaving 3 billion yuan ($440 million) in debt, the South China Morning Post reported on Wednesday.
Morgan Stanley, Goldman and private equity firm Actis Capital had paid $73 million for a 31 percent stake in the company in 2007, with Morgan Stanley providing $18 million, Goldman $15 million and Actis Capital $40 million.
The Grand Court of the Cayman Islands on Monday appointed Hong Kong accountant Borrelli Walsh as provisional liquidators of the former high-flying firm, the paper reported, citing documents it had reviewed.
Citigroup is the company's biggest lender, while the company also owed money to Britain's Royal Bank of Scotland and Singapore's DBS, according to the report.
Taizinai and Actis could not be reached for comment. The banks and Borrelli Walsh declined to comment.
Once an IPO candidate, Taizinai, best known for its probiotic yoghurt drinks, was the victim of expanding too quickly, the paper reported. Its fortunes also suffered a blow during China's tainted milk scandal, which hurt dairy sales throughout China.
Hunan-based Taizinai did not sell any contaminated products, but was hit by the public's broader distrust in the dairy industry after the scandal, the South China Morning Post said.
As recently as the middle of last year, the company was also cited in Chinese media as a takeover target by Nestle SA, the world's biggest food group.