Chinese developer Sunac plans to extend onshore bonds maturity - sources

Logan

22/11/2022 04:42

Nov 22 (Reuters) - Property developer Sunac China
Holdings Ltd  1918.HK  plans to classify onshore bonds worth
14.6 billion yuan ($2.07 billion) into two groups and extend the
repayment periods by up to four-and-a-half years, two sources
with knowledge of the matter said.
    Sunac earlier this year extended repayment for a 4-billion
yuan bond. It is now proposing to further extend the repayment
of 3.4 billion, the unpaid amount of this tranche, by three
years and nine months to September 2026, said the sources.
    Full repayments for the rest of the onshore bonds will be
extended by four-and-a-half years to 2027, according to the
sources, who declined to be named as they are not authorised to
speak to the media.
    Sunac is among a growing number of Chinese developers to
have defaulted on debt obligations in the past year. China's
property sector has faced a series of headwinds as regulators
have clamped down on excessive borrowing, including slower
property sales, bond defaults, and stalled construction.
        Sunac, which has been in talks with creditors to
restructure onshore bonds, did not respond to Reuters' request
for comment.
    The Beijing-based developer will start repaying the
principal of these bonds from 2025, with cash installments every
three months, while the value of installments will rise over
time, said the two sources. 
    Sunac will offer its bondholders interest from its property
and tourism projects as credit enhancement measures, and the
plan will be voted on by creditors in early December.
    Separately, smaller rival Logan Group Co.  3380.HK  earlier
proposed to extend the full repayment of its onshore bonds to
May 2027. The plan has not received approval of its creditors
yet, according to the two sources.
 (Reporting by Shuyan Wang in Beijing, Steven Bian in Shanghai
and Xie Yu in Hong Kong; Editing by Sumeet Chatterjee and Ana
Nicolaci da Costa)
 ((Yu.Xie@thomsonreuters.com;))