The Chinese property development company Country Garden has proposed to its offshore creditors the deal, which will reduce the debt of this firm by $11.6 billion.
The materialization of the mentioned intention will allow Country Garden to seek more time from the high court in Hong Kong to implement the restructuring plan.
It is known that the indebted developer has reached an understanding with a group of creditors consisting of seven banks. This result was recorded ahead of the company’s liquidation hearing, which is scheduled for January 20 in Hong Kong, bringing it closer towards a restructuring of its offshore debt.
Country Garden, which found itself in a very difficult situation, was in the past one of the largest property developers in China. At the end of 2023, this company defaulted on offshore bonds worth $11 billion. Against this background, the state of affairs in the Chinese real estate sector has deteriorated significantly, which has been in the condition of a downturn for several years. It is worth noting that this situation has become a factor of significant pressure on the Chinese economy.
As of today, the mentioned Asian country’s real estate sector has experienced the defaults of many developers, including China Evergrande Group.
At the end of 2023, Country Garden had $16.4 billion in offshore debt, including $10.3 billion in bonds and three syndicated loans with an outstanding principal amount of $3.6 billion.
The mentioned company’s proposal outlines options for creditors, including converting debt into cash with a 90% haircut or receiving new debt instruments with delayed maturity.
As we have reported earlier, Country Garden Delays Earnings.
