Chinese developer Kaisa misses bond payments
By P.R. Venkat
Kaisa Group Holdings Ltd. said on Monday he had missed payments on various senior bonds and was in talks of a debt restructuring with the bondholders.
The Chinese developer failed to make a payment on a senior note of $ 400 million, 6.5%, which matured on Dec. 7 and missed interest payments on three other bonds.
Investor repayment failures are mounting in China’s real estate sector as companies come under pressure from falling home sales, government restrictions on borrowing and a bond market liquidation that has virtually shut down the market. market for new transactions.
In recent months, smaller companies including Fantasia Holdings Group Co., Modern Land (China) Co. and Sinic Holdings Group Co. have defaulted. S&P Global Ratings lowered China Evergrande Group to one of its lowest possible ratings on Friday, deeming the real estate giant in default after failing to repay its debt.
Shenzhen-based Kaisa is one of the biggest offshore borrowers in China’s real estate industry after Evergrande. To date, Kaisa has said its senior bond principal outstanding is $ 11.78 billion.
Non-payments can lead creditors to demand accelerated repayment, although no such notice has been received so far, Kaisa said.
Kaisa appointed Houlihan Lokey as financial advisor to assess the group’s capital structure and explore workable solutions to alleviate the current liquidity problem.
The company also warned that the confidence of potential real estate buyers remained low in December, further reaffirming the stress the sector is facing.
Shares of Kaisa, which has been halted since December 8 on the Hong Kong Stock Exchange, will resume trading on Monday.
Write to PR Venkat at venkat.pr@wsj.com