Gionee is officially bankrupt, owes $3 billion

A court in Shenzhen has accepted the bankruptcy application by Gionee, which will now put the business at a crossroads.

As of August, mobile phone giant, Gionee owes ¥20.2 billion, which is estimated around $2.9 billion USD, to 648 creditors. Despite this huge amount being owed, the founder of Gionee, Liu Lirong, states that he’d like to see a turnaround in three to five years. As of last week, the company hired a restructuring consultant to create a plan for the organization that would allow it to come out of this situation.

Gionee’s money troubles were worsened when Liu – founder and chairman – lost a CNY 1 billion bet in a casino. That’s a whopping $144 million! At first, he claims he didn’t use company money, but later admits he may have “borrowed company funds”. This story would make quite an interesting movie.

For comparison, Liu claims that the company was losing around CNY 100 million ($14.4 million) a month between 2013 and 2015. The losses per month doubled in the last two years