The subsidiary of Chinese property developer Greenland Holding has launched repurchasing for as much as $18.5m to comfort investors. This attempt happened principally on May 27, which is earlier than its June 3 maturity. This total repurchasing was from the 12% of the principal of the $150m notes allocation. The firm issued the note last year, the firm had announced this event on the Hong Kong Stock Exchange.
Greenland Global Investment previously launched consent solicitation to leverage the maturity of note for $488m which is 6.75%. After another subsidiary, the firm started the repurchase. The note has the guarantee from the firm’s parent by one year which is June 25 2023. The company also requested to have 10% upfront payment on the date of original maturity.
Basically, many Chinese real estate companies have been buying back bonds in order to improve liquidity in the sector. Other companies like Country Garden Holdings launched repurchasing too for $9m from its 4.75% notes. It is going to be due in July 2022. Meanwhile, the $1m from its 4.75% bonds which is due in January 2023. The issuer has purchased the amount of $55.7m of the 2023 and 2022. This is the 7.25% notes which are due in April 2026, since last December.
On the other hand, the hope of giving investors comfort during the bad situation turns out to be harder. Market participants testify that those repurchases failed to restore investor confidence. They argued that the major reason could be because those firms are too small and thus risky. Even in many cases, those repurchases are only for a few months or months prior to maturity. On May 30, Moody downgraded Greenland as well as Greenland HK for the second time. It also lowered the parent’s issuer.
