By Clare Jim
HONG KONG (Reuters) -China’s Nation Backyard (HK:) expects to succeed in phrases with collectors subsequent month relating to the restructuring of $16.4 billion in offshore debt, and apply for courtroom approval of the phrases in April, its lawyer advised a Hong Kong courtroom on Monday.
The property developer was granted an adjournment till Might 26 in a listening to held to gauge the extent to which restructuring is continuing forward of a choice on a liquidation petition.
“Adjournment today is to allow the company to continue to make progress on the restructuring,” Hong Kong justice Linda Chan mentioned.
Nation Backyard was as soon as China’s largest developer by gross sales. It defaulted on $11 billion in offshore bonds in late 2023, deepening a debt disaster in a sector that had seen defaults by main friends together with China Evergrande (HK:) Group.
Evergrande was ordered by the Hong Kong Excessive Courtroom to liquidate in January final yr after the developer was unable to suggest a debt restructuring plan acceptable to collectors.
Averting liquidation would permit Nation Backyard to return its focus to a property sector blemished by unfinished properties and shattered purchaser sentiment, and the place policymakers have struggled to show the tide with a wave of stimulus measures since 2022.
Nation Backyard mentioned this month it has proposed restructuring that will minimize offshore debt by 70% and that it had reached an “understanding” with a lender group.
Its lawyer requested on Monday time to resolve three “sticky points” in negotiation with two main teams of collectors – a bunch of bondholders with 30% of excellent U.S. greenback senior notes and a bunch of lenders comprised of seven banks.
The problems relate to the lender group releasing its safety package deal in change for compensation, the conversion value of convertible bonds and the phrases of latest notes.
Chan mentioned Nation Backyard ought to disclose whether or not it expects to succeed in an settlement with collectors by February-end. If it doesn’t, events together with the petitioner and collectors can apply to carry the following listening to ahead.
Ever Credit score, a unit of Hong Kong-listed Kingboard , filed a petition in opposition to Nation Backyard in February for not repaying a $205 million mortgage.
