Bond trustee becomes new petitioner to liquidate China developer Kaisa

Kaisa group

08/03/2024 05:07

HONG KONG, March 8 (Reuters) - A Hong Kong court
adjourned a hearing to liquidate Chinese property developer
Kaisa Group  1638.HK  to April 29 after a bond trustee,
instructed by a major group of dollar bondholders, replaced the
original petitioner. 
    The latest development came after Broad Peak Investment,
which filed the winding-up petition in July in relation to
non-payment of onshore bonds worth 170 million yuan ($24
million), sought to withdraw from the case as it has sold the
debt holdings earlier this year.  
    Shenzhen-based Kaisa has been working on a debt
restructuring for two years after defaulting its $12 billion of
offshore debt in late 2021.
    Kaisa is China's second-largest issuer of offshore debt
among developers after China Evergrande Group  3333.HK  and was
the first Chinese property developer to default on its dollar
bonds in 2015.
    Many Chinese developers, including giant Country Garden
 2007.HK , are facing winding-up petitions filed after the
sector plunged into a debt crisis in 2021, resulting in numerous
firms defaulting on their debt obligations. Evergrande was
ordered to liquidate by the Hong Kong High Court in January.
        Kaisa said in a filing on Friday that Citicorp
International, the substituting petitioner, would file a
re-amended petition against the company in relation to the
non-payment of the 2023 notes with an outstanding principal of
$750 million.  
  
        A lawyer for the ad hoc bondholder group said after the
hearing on Friday that Citicorp is the bond trustee and it acts 
on the instruction of the group.
  
    A lawyer for Broad Peak in the last hearing in October cited
a statement that Kaisa filed with the court, saying creditors
would get less than 5% of their money back if it was forced into
liquidation. Kaisa also said its cash to short term debt ratio
was 0.02 and that it was cashflow insolvent. 
    Kaisa had 232.5 billion yuan of total liabilities and 278.7
billion yuan of total assets as of the end of June 2023,
according to its interim results. 
($1 = 7.1925 Chinese yuan renminbi)

 (Reporting by Clare Jim; Editing by Lincoln Feast)
 ((clare.jim@thomsonreuters.com;))