Creditors holding 29.9% of bonds agree to restructuring plan
Chairperson to convert $1.15 billion shareholder loans
Nears deal to finalise restructuring with banks holding $3.6 billion in syndicated loans
Recasts, adds details on shareholder loan in paragraphs 6-8, further background in paragraph 10
April 11 (Reuters) - Chinese property developer Country Garden 2007.HK said on Friday it had reached an agreement with creditors holding nearly 30% of its existing offshore bond debt and was close to finalising terms with another group of bank creditors.
The company is now in a restructuring process that aims to cut its $16.4 billion of offshore debt by 70%. Creditors holding 29.9% of $10.3 billion in bonds had agreed to the plan, it said.
The embattled developer, which had secured a reprieve from potential liquidation until May 26, was also close to finalising a deal with a lender group made up of seven banks who hold three syndicated loans with an outstanding principal amount of $3.6 billion.
The real estate firm has offered five restructuring options to its creditors including extending the maturity by as much as 11-1/2 years alongside choosing mandatory convertible bonds and new debt instruments.
The proposed restructuring covers the aggregate outstanding principal amount of $14.07 billion of its existing debt, Country Garden said.
In a separate relief for the crisis-hit firm, its controlling shareholder, Chairperson Yang Huiyan, has agreed to convert her $1.15 billion shareholder loan.
Huiyan will buy a 60% stake in the company's Malaysian unit Country Garden Pacificview, for $50 million and use the balance to subscribe to more shares in the company.
The chairperson held a 52% stake in Country Garden as of the end of 2023, according to data compiled by LSEG. Her shareholding will reduce to not less than 40% after the debt restructuring is completed, the company said.
Country Garden's downturn in fortunes, culminating in an $11 billion default after its reign as China's top developer by sales, intensified a debt crisis that was already gripping rivals such as Evergrande 3333.HK.
In March, it said its net loss attributable narrowed to 32.8 billion yuan ($4.48 billion) in 2024, down from a record loss of 178.4 billion yuan for 2023, even as it battles a liquidation petition brought by Ever Credit, a unit of Hong Kong-listed Kingboard 0148.HK.
($1 = 7.3140 Chinese yuan renminbi)
(Reporting by Aaditya Govind Rao and Roushni Nair in Bengaluru; Editing by Maju Samuel and Stephen Coates)
((Roushni.Nair@thomsonreuters.com;))
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