Land Paradise expects to reach an agreement with creditors in February, a lawyer told Reuters in court.
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Hong Kong (Reuters) – China Country garden (HK:) He wants to reach an agreement with creditors next month on a $16.4 billion restructuring of offshore debt and submit the terms to the court in April for approval, his lawyer told a Hong Kong court on Monday.
The property developer was granted a stay until May 26.
Hong Kong judge Linda Chan said: “Today’s respite is to allow the company to continue to make progress on its restructuring.”
Country Garden was China’s largest developer by sales. In the year It has made $11 billion in offshore bond payments by the end of 2023, exacerbating a debt crisis in the sector that has seen defaults by major partners including China. Evergrande (HK:) group.
Hong Kong’s High Court ordered Evergrande to be wound up in January last year after the developer failed to submit a debt restructuring plan acceptable to creditors.
Avoiding liquidation would allow Country Garden to turn its attention to a property sector hit by unfinished homes and fragile buyer sentiment, and policymakers have been scrambling to turn the tide with stimulus measures starting in 2022.
Country Garden said this month it had submitted a restructuring proposal that would reduce offshore debt by 70% and reached an “understanding” with a group of creditors.
The lawyer asked on Monday to resolve three “sticking points” in negotiations with two major groups of creditors – 30 percent of outstanding US dollar senior notes and a group of creditors comprising seven banks.
The issues relate to the creditor group’s release of its security package for compensation, the convertible bond’s conversion rate and the terms of the new notes.
Chan said Country Garden should reveal whether it expects to reach an agreement with creditors by the end of February. If this is not the case, you can apply for the next hearing including the litigant and the creditors.
Hong Kong-listed Ever Credit, a unit of Kingboard, filed a lawsuit against Country Garden in February for defaulting on a $205 million loan.