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Chinese real estate developer Kaisa announces debt restructuring plan

Chinese real estate developer Kaisa announces debt restructuring plan

BEIJING — Chinese real estate developer Kaisa introduced Thursday plans for paying again buyers, quickly assuaging issues a couple of default as China’s property sector continues to face strain.

Kaisa’s Hong Kong-listed shares popped 20% out there open, earlier than paring some beneficial properties. It was the primary day of buying and selling after an almost three-week halt. The developer had suspended buying and selling after lacking a cost on a wealth administration product earlier this month.

“Repayment measures have been implemented” for about 1.1 billion yuan ($171.9 million) of the wealth administration merchandise, Kaisa mentioned in a submitting with the Hong Kong inventory trade. The developer mentioned it is in negotiations about reimbursement of the remaining 396.6 million yuan in wealth administration merchandise.

Individually, Kaisa mentioned it could restructure offshore debt funds due in December by providing buyers new bonds price $380 million that at the moment are due in 2023. The unique U.S. dollar-denominated bonds had been price $400 million.

Amongst Chinese builders, Kaisa is the second-largest issuer of U.S. dollar-denominated offshore high-yield bonds, in response to French funding financial institution Natixis. Evergrande, the world’s most indebted real estate developer, ranks first.

As of the primary half of this yr, Kaisa had crossed two of China’s three “red lines” for real estate builders that the federal government outlined, in response to Natixis.

“Persistent tightening governmental policy, multiple credit events and deteriorating consumer sentiment have resulted in temporary shut-down of various refinancing venues for the sector and put enormous pressure on our short-term liquidity,” Kaisa mentioned in a submitting Thursday.

“Despite our efforts to reduce our interest-bearing debt in response to government regulations, the current sharp downturn in the financing environment has limited our funding sources to address the upcoming maturities,” the corporate mentioned.

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