Hong Kong builder New World Development said on Monday it had received commitments for a HK$88.2 billion ($11.24 billion) loan refinancing package, as the property developer finalises a crucial lifeline in a struggling market.
The refinancing, poised to be one of the largest ever seen in Hong Kong, concludes months of negotiations over a debt package designed to steer the company away from the brink of default.
New World said it had refinanced portions of its existing offshore unsecured debt, including bank loans, through a new facility and had also aligned the terms of its remaining loan agreements.
The new facility consists of multiple tranches of bank loans with different maturities, with the earliest being June 30, 2028.
The refinancing includes terms, such as financial covenants and security over certain assets, that provide the firm with greater flexibility to effectively manage its ongoing business operations and financial requirements, the company said.
“We would like to express our sincere gratitude to the banking community for their continued support. This is a testament to the confidence placed in our operation,” said Echo Huang, CEO of New World.
She added that the group’s financial management strategy is to prioritise reducing indebtedness and improving cash flow.
The update comes after media reports suggested the property developer, which carries one of the highest debt ratios among its peers, was close to securing a loan refinancing deal.
Earlier this month, Reuters reported that the company had made a dollar bond interest payment due on June 16, citing sources.
This followed the developer’s earlier warning that it would defer $77.2 million in coupon payments on four perpetual bonds scheduled for the same month.
Reuters
