© Reuters. FILE PHOTO: An indication of the Kaisa Group Holdings is seen on the Shanghai Kaisa Financial Center, in Shanghai, China, December 7, 2021. REUTERS/Aly Song
(Reuters) – Kaisa Group stated on Monday it has not acquired any discover from bondholders to speed up repayments yet because the embattled Chinese property developer has not repaid a $400 million offshore bond.
The agency stated it additionally did not pay the coupon totalling $105 million for notes due in 2023, 2025, and 2026, with the grace interval for the primary two already expired.
The non-payment on the $400 million maturity on Dec. 7 triggered cross-default provision on all its $12 billion offshore bonds and prompted a downgrade to “restricted default” by Fitch Ratings.
Kaisa is the second-largest greenback bond issuer amongst China’s property builders after China Evergrande Group, which has greater than $300 billion in liabilities.
The destiny of Kaisa, Evergrande and different indebted Chinese property firms has gripped monetary markets in current months amid fears of knock-on results, with Beijing repeatedly in search of to reassure traders.
Shares of Kaisa tumbled 8.7% to HK$0.84 within the early session on resumed buying and selling, a document low, after a suspension since Dec. 8.
Kaisa stated it was nonetheless in talks with bondholders over a debt restructuring deal and it had employed Houlihan Lokey (NYSE:) as its monetary adviser and Sidley Austin as a authorized adviser.
Kaisa was in talks with Lazard (NYSE:), the adviser of a bunch of offshore bondholders, to signal a non-disclosure settlement (NDA), Reuters has reported, laying the groundwork for additional discussions on forbearance and financing options.
The group deliberate to make use of as much as $1 billion in an effort to purchase unhealthy loans from the Chinese developer’s onshore collectors, sources stated final week.
In the Monday submitting, the developer added after vital decline in gross sales in October and November, it expects the boldness of potential property purchasers to stay subdued in December.
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