Developer Sunac China reaches restructuring deal with offshore creditor group

Sunac Services Holdings

28/03/2023 15:02

HONG KONG, March 28 (Reuters) - Embattled property
developer Sunac China  1918.HK  said on Tuesday it has reached
agreement with a group of offshore creditors to restructure $9
billion of its debt.
    Sunac, one of the biggest property developers in China, is
among the many that defaulted last year as the sector reeled
under a debt crisis. 
    China Evergrande Group  3333.HK , the world's most indebted
property developer, last week announced plans for the
restructuring of $22.7 billion in offshore debt, which could
create a template for distressed rivals and shape investor
sentiment towards the country's embattled property sector.
    Beijing-based Sunac said part of the debt will be exchanged
into convertible bonds backed by its Hong Kong-listed shares,
along with new notes with maturities of between two and nine
years, bearing interest rates between 5% and 6.5%.  
    Sunac said there will be an option for the company to extend
the maturity of the first two tranches - new notes with two- and
three-year maturities - by one additional year.
    Creditors can also choose to convert some debt into another
convertible bond with a lower conversion price, or shares in its
property management unit, Sunac Services  1516.HK . 
    A consent fee of 0.1% of the debt holding will be paid to
creditors who give their support before April 20, and the
restructuring is expected to take effect on Sept 30.    
    The property developer said its shares, which have not
traded since April 1 2022 pending the release of 2021 financial
reports, will remain suspended. 
    Earlier this year, Sunac extended the maturity of its 16
billion yuan ($2.33 billion) onshore bonds by an average of 3.5
years.
    
($1 = 6.8761 Chinese yuan renminbi)

 (Reporting by Clare Jim; Editing by Christina Fincher)
 ((clare.jim@thomsonreuters.com;))