SOME 6,500 workers in Dongguan are now jobless after two toy factories owned by Hong Kong toy giant Smart Union Group went bankrupt Tuesday.

    Hong Kong-listed Smart Union Group is one of the biggest players in the toy industry. Its clients include Mattel, the world’s biggest toy company.

    Analysts say Smart Union Group is the biggest Chinese company brought down by the financial crisis so far. The group’s share price dropped to HK$0.08 (US$0.01) on Tuesday, down more than 90 percent from its highest price of HS$2.38 on July 20, 2007.

    Smart Union Group has two factories in Dongguan and two in Qingyuan. The Southern Metropolis Daily said the two factories in Qingyuan had also been closed.

    Managers of the factories have disappeared. Workers and suppliers surrounded the front door of the factories Wednesday after the Dongguan court sealed the doors overnight.

    The closure of the factories was a surprise blow for the workers, who turned up at the factories as usual, only to find they were closed. Some workers said they had not been paid since August.

    A government notice on the closed door promised to help the workers get their wages within three days.

    Several suppliers were waiting outside the factory with the hope of getting paid. A supplier said Smart Union Group was in debt with many suppliers and that it owed one supplier nearly 20 million yuan.

    The Dongguan government has confirmed the bankruptcy of the two factories.

    Chao Gangling, head of the business school of Shanghai University of Finance and Economics, said Smart Union Group was the worst-hit enterprise in the financial crisis.

    “The financial crisis hit the OEMs more than any other areas. The Smart Union Group has lost HK$200 million in the first half of this year, and it hasn’t been easy for it to survive until now,” said Chao.

    The financial crisis hit Dongguan hard, too. Dongguan’s toy exports slightly dropped in the first six months of this year, the first drop in recent years.

    (Helen Deng)