China Eximbank reschedules — via an interest rate adjustment in 2021 — a $21.4 million USD portion of a $74.8 million USD loan to Shandong Ruyi Group to finance its acquisition of a 80% stake in Cubbie Station

Project narrative

On January 21, 2013, the Export-Import Bank of China entered into a $74,800,000 USD loan facility agreement with Shandong Ruyi Scientific and Technology Group Co‑Ltd — a Chinese textile and garment company based in Jining, Shandong listed on the Shenzhen Stock Exchange — to finance its acquisition of a 80% stake in Cubbie Station in Queensland, Australia. On January 18, 2013, Mister Qiu Yafu, a significant beneficial owner of Ruyi and a director of CSTT Co Holdings Pte Ltd, a Singapore-incorporated wholly-owned subsidiary of Ruyi, signed a letter of undertaking stating CSTT would pledge its assets as collateral for the China Eximbank loan, that it would not pledge the Cubbie Station assets to anyone else, and that it would apply any incoming funds from sale of shares to repay the China Eximbank loan. The loan benefited from a joint and several liability guarantee from Chongqing Sanxia Technology Textile Co., Ltd. and a joint and several liability repayment guarantee from Mr. Qiu and his spouse. Record ID#111042 captures China Eximbank's loan. The proceeds were to be used by the borrower to finance its acquisition of Cubbie Station (also known as the Cubbie Cotton Field Project), a large property in the Murray-Darling food bowl area Queensland, consisting of 93,483 hectares (229,810 acres) (larger than the island of Singapore and equal in size to Canberra) and including 6,876 square meters of ancillary buildings, significant farmland and cotton industry assets, capable of growing cotton, wheat, barley, sorghum, and corn, with 513 million cubic meters of water rights (enough water entitlements to fill Sydney Harbour). Cubbie Station was the largest irrigated land aggregation in the Southern Hemisphere. On July 4, 2012, Ruyi entered into a term sheet to purchase an 80% holding in Cubbie Station. On October 4, 2012, Ruyi incorporated CSTT Co Holdings Pte Ltd. On October 5, 2012, a company called CS Agriculture Pty Ltd (CSA) was incorporated in Australia as a special purpose vehicle joint venture for the acquisition, with CSTT holding 80% and the remaining 20% being held by an unrelated Australian investor, Lempriere Pty Ltd. On October 11, 2012, CSA entered into a contract to purchase of land and business assets including water license of Cubbie Station for $230,000,000 AUD, with CSA’s obligations as purchaser guaranteed by Ruyi. China Eximbank advanced the $74,800,000 USD in funds to Ruyi on January 21, 2013, and Ruyi then used the loan funds and its own funds to provide equity funding to CSTT, which then lent $176,500,000 AUD to CSA to complete the purchase. In total, 30% of the $230 million AUD acquisition was from equity from the existing cash reserves of Ruyi and Lempriere and the other 70% from China Eximbank (or other lenders). The acquisition was completed on January 25, 2013. At the time, Cubbie Station went into administration in 2009 following financial troubles. Australia's Foreign Investment Review Board (FIRB) approved the acquisition, with the FIRB requiring the acquisition loan not use Australian assets as collateral in order for it to be approved (impacting China Eximbank). Viewed as an iconic property, a number of Australians expressed concern and disappointment that prime, famous agricultural land was being sold to foreign interests. The acquisition drew further criticism from some Australian lawmakers who argued Australia was losing control of a strategic asset. On July 25, 2016, Miss Fengmei Gu, claimed to be an “executive director” and “authorized representative" of CSTT, granted a security interest and mortgage over its 80% interest in the CSA SPV to the Qingdao Branch of China Eximbank in an agreement governed by Victorian law, which was then registered on the Personal Property Securities Register (PPSR) in Australia. In August 2019, Macquarie Group purchased a 49% stake in Cubbie Station from the Ruyi-led consortium. In 2020, Ruyi began facing financial problems. On February 25, 2020, a group of 33 banking creditors of Ruyi, including China Eximbank, met and entered into a creditors agreement with it, in which it included CSTT as part of Ruyi. On March 20, 2020, China Eximbank signed an extension agreement with Ruyi, extending the payment dates for the principal payable installments for $21,400,000 USD of the principal. Ruyi, Shandong Ruyi Real Estate Co., Ltd., Shandong Ruyi Wool Textile Group Co., Ltd., Wenshang Ruyi Technology Textile Co., Ltd., Mister Qiu Yafu, Bai Wenhui, Xin Liang, CSTT, and Chongqing Three Gorges Technology Textile Co., Ltd. (formerly Chongqing Sanxia Techology) issued guarantees under this "master contract". Record ID#111046 captures this extension. On November 20, 2020, China Eximbank, Ruyi, CSTT, Mr Qiu, and certain other parties entered into a supplementary agreement to adjust the interest payment plan of the extended loan. Record ID#111047 captures this adjustment. On December 15, 2020, China Eximbank attended a meeting of the Standing Creditors Committee of Ruyi. On March 26, 2021, China Eximbank attended a second meeting of Ruyi's creditors. On May 19, 2021, China Eximbank, Ruyi, CSTT, Mister Qiu, and certain other parties entered into another supplementary agreement to adjust the interest payment plan of the extended loan. Record ID#111048 captures this adjustment. On December 21, 2021, Ruyi failed to pay interest due to China Eximbank under the loan facility agreement, and thereafter entered into default (as of August 2025, it had not paid any additional interest). On January 13, 2022, China Eximbank issued a letters of demand to Ruyi for repayment. On August 1, 2022 it began recovery proceedings against Ruyi before the China International Economic and Trade Arbitration Commission (CIETAC) for the loan and the charge registered in respect of Ruyi's shares in CSTT. On September 9, 2022, China Eximbank issued a letter of demand for payment to CSTT, and then another on December 1, 2022. On December 19, 2022, it commenced proceedings against CSTT in the Supreme Court of Victoria, Australia, with a view to enforcing the outstanding loan capital and interest against CSTT’s shares in CSA, the joint venture vehicle which owned Cubbie Station property and cotton and other business assets, despite the fact that China Eximbank did not advance any loan funds directly to CSTT. China Eximbank argued that documents, such as the letter of undertaking, showed CSTT accepted responsibility to repay the loan and had pledged its interest in Cubbie Station for said purpose. On June 1, 2023, CIETAC issued a partial arbitral award finding that the share charge agreement validly pledged all equity in CSTT held by Ruyi in favor of China Eximbank, and that China Eximbank was legally entitled to sell all the shares in CSTT and receive priority repayment for its loan from the proceeds. Judge Jim Delany of Supreme Court of Victoria ruled against China Eximbank, arguing that the letter of undertaking Qiu signed on behalf of CSTT violated the corporate constitution of CSTT (available in the publicly accessible Accounting and Corporate Regulatory Authority (ACRA) of Singapore), which stated documents must be either executed with the company seal or signed by two directors (the other director having failed to sign it); ergo, Qiu could not contractually bind CSTT. China Eximbank had also attempted to argue that CSTT was estopped (i.e. legally prevented) from disclaiming the document, but Judge Delany found no evidence that China Eximbank relied on the letter of undertaking to advance funds. Furthermore, for the 2016 security agreement, Delany ruled that CSTT gained no benefit from the 2016 security agreement (known legally as a lack of consideration) as the loan was long issued and therefore the security agreement was unnecessary and that the alleged "authorized representative" of CSTT who signed the security agreement, Fengmei Gu (a senior executive of Ruyi) did not have authority to do so for CSTT (and Qiu's document granting her such as invalid per CSTT's constitution, as it required a resolution of directors or signature of two directors). The extension agreements were only signed by Qiu and did not have the company seal of CSTT affixed, so Delany did not find them valid and China Eximbank's entire claim against CSTT were dismissed.