Gionee goes bankrupt, as it owes 648 creditors $2.9 billion USD

Your favorite Android smartphone, Gionee has declared for bankruptcy.

Gionee Logo | Gionee Facebook Page

The official announcement is coming after several weeks of media reports. of the company going into liquidation.

A court in Shenzhen has accepted the application for liquidation bankruptcy by Huaxing Bank.

GSMArena reports that the mobile company may reorganize its structures and administration due to the official bankruptcy acceptance by court as it recently hired restructuring consultants.

Founder Liu Lirong thinks that the company can turn its fortunes around in 3-5 years.

However, Gionee owes a total of CNY 20.2 billion (around $3 billion) to 648 creditors. About half of the debt is to banks. Earlier this year the company failed to pay suppliers.

Ad agencies haven’t been paid either.

Financial issues started for the company when the founder and chairman Liu lost a CNY 1 billion bet in a casino.

Liu admitted in the interview that Gionee’s total debts amount to 17 billion yuan ($2,447,065,000), with 10 billion yuan($1,439,450,000) of this owed to banks, 5 billion yuan($719,725,000) to upstream suppliers and about 2 billion to advertising agencies.

Is this the end of Gionee Electronics and Smartphones?