Debt-laden property developer China Sunac told its offshore creditor it would carry out a second round of debt restructuring, a Hong Kong court heard on Monday, which would make it the first in the sector to do so.
A unit of state-owned asset manager Cinda, Cinda (HK), filed a liquidation petition early this year against Sunac in relation to the non-payment of a $30 million loan.
The petition surprised many in the market because Sunac completed its $9 billion offshore debt restructuring in 2023, the first troubled developer in China’s property sector to achieve the milestone since the debt crisis that started in 2021.
A second debt restructuring and the new liquidation petition underscore the protracted battle facing the developer and the sector.
A lawyer for Cinda, Thomas Wong of Temple Chambers, sought an immediate liquidation of Sunac on Monday because he said the developer did not provide any documentation to show it was conducting a restructuring that it said it was doing.
Judge Gary Lam, citing other creditors opposed to a liquidation, adjourned the hearing to April 28 for Sunac to show its progress on restructuring.
This is the first time Sunac has confirmed it would undergo a second offshore debt restructuring.
“Given the impact of the petition…and considering that the current market conditions are significantly below the expectations when the prior offshore debt restructuring plan was formulated, the company does not exclude seeking a more comprehensive holistic offshore debt solution based on the actual situation,” it said in a filing in January.
Reuters
