CHINA Minsheng Investment Group (CMIG), among the country’s largest private investment firms, is raising funds from its employees as it seeks to combat a liquidity squeeze, a company representative said Friday.

The company has set up a special funding pool for the fundraising. All of CMIG’s employees in its headquarters can put their own money into the pool and choose between buying CMIG’s debt or equity, said the representative.

Debt-laden CMIG, once among China’s most high-profile and acquisitive private companies domestically and globally, had missed payment and formed an emergency committee to deal with its liquidity troubles, raising investors’ fears about financing pressures on China’s overall private sector.

CMIG was set up in 2014 with a registered capital of 50 billion yuan (US$7.25 billion) and with the approval of the State Council. Its businesses spans leasing, new energy, airlines, construction and investment.

According to Refinitiv data, CMIG has 12 outstanding yuan bonds worth 29.75 billion yuan. It also issued bonds worth US$800 million through Boom Up Investments, a subsidiary domiciled in the British Virgin Islands.

This is not the first time for a Chinese private company to raise money from its employees. Indebted HNA Group Co. had also sold investment products to staff but later missed some repayments under financial pressure.

Data collected by Reuters shows that Chinese issuers defaulted on bonds with a principal amount of 23.31 billion yuan in the first four months of 2019, up more than 70 percent from a year earlier.(SD-Agencies)