Chinese developer Shimao plans to use own funds to pay onshore bonds

Shimao Services Holdings

28/12/2021 03:31

HONG KONG, Dec 28 (Reuters) - Chinese developer Shimao
Group's  0813.HK  flagship unit said it plans to use its own
capital to make onshore bond payments due in the next three
months, and it is in talks to sell its commercial and hotel
assets. 
    Shanghai Shimao Co  600823.SS  also said it will be
difficult to meet its 38 billion yuan ($5.96 billion) full-year
sales target, as sales in the first 11 months were 28.2 billion
yuan.
    The firm published the comments made to investors in a
filing on Monday.
    Shimao saw sharp falls in its shares and debt this month,
triggered by worries over an asset sale and cancelled apartment
deals, as well as downgrades by rating agencies on increased
financing risks.  urn:newsml:reuters.com:*:nL1N2SZ1R3 urn:newsml:reuters.com:*:nL1N2T2055    
    Shanghai Shimao also caused further worries when it said
earlier it had sold its property management business to sister
company Shimao Services  0783.HK  for 1.7 billion yuan ($267
million), at a valuation some analysts said was higher than
market average.
    The firm said in the Monday filing the proceed is for
developing and operating commercial complex, not repaying debt.
    Separately, Shimao Services - the group's property
management arm - said in a filing on Friday it is operating
steadily, and it will not conduct any major assets disposal or
acquisition with parent company in next six months.  urn:newsml:reuters.com:*:nFWN2T9068
    Shares of Shimao Group and Shimao Services, both listed in
Hong Kong, rose over 2% on Tuesday. Shanghai Shimao dropped 2%.
    Shimao Group has told investors in November its sales this
year would be around 290 billion yuan due to a national credit
tightening, and it would consider selling come commercial and
hotel assets if prices were good.  urn:newsml:reuters.com:*:nL4N2RX0BW    

($1 = 6.3721 Chinese yuan renminbi)

 (Reporting by Clare Jim; Editing by Michael Perry)
 ((clare.jim@thomsonreuters.com; +852 2912 6653; Reuters
Messaging: clare.jim.thomsonreuters.com@reuters.net))