(Reuters) – Chinese property developer Shimao Group has secured creditor backing to restructure about $11.04 billion in offshore debt, the latest such deal in the sector after years of liquidity troubles.
Sunac China became the first troubled Chinese property developer to successfully reduce its onshore debt earlier this year, while CIFI Holdings has reached an agreement with a key group of bondholders on an offshore debt restructuring plan.
Shimao said on Monday 98.75% of its creditors, representing claims totalling about $11.04 billion, had backed its plan announced last March to restructure all of its debt, amounting to around $11.7 billion in offshore notes, bonds and other credit facilities.
The embattled developer had been negotiating with creditors to refine the term sheet after a group of major bondholders said last year they “firmly oppose” the firm’s proposal to revamp $11.5 billion of offshore debt it had defaulted on in 2022.
Shimao had offered bondholders four options, including repayment through short-term notes, long-term notes, zero-coupon mandatory convertible bonds, and a fixed combination of them.
“Therefore, the scheme was approved by the requisite majorities of scheme creditors,” the company said in a statement on Monday.
The petition seeking sanction of the scheme will be heard on March 13, Shimao said.
Since China’s property crisis unravelled in 2021, several developers in the country, including China Evergrande Group, have faced liquidation lawsuits by creditors, with some firms already ordered to dissolve.
(Reporting by Roushni Nair in Bengaluru; Editing by Devika Syamnath)
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