Sunac has failed to make a U.S. dollar bond coupon payment in the given period of time. Sunac China Holdings is China’s fourth-largest property developer company. It became the greatest default scandal in the sector. Initially, the borrower missed the payment in May 11 deadline for as much as $29.5m coupon in its $741.6m October 2023 bonds. Actually, the original due date was in April with a 30-day grace period.
Missed the payment means coming to a default. It allows bondholders to accelerate the repayment of the principal and accrued interest. But, the company argued that they have yet received acceleration notice from the creditors. In April this year, Sunac skipped the coupon payments for the three other bonds. The firm failed to pay $26.8 for an 8.3% April 2023 bond.
This year, the issuer owns two offshore bonds; a $600m or 7.25% note in June and $600m or 7.95% bond in August. Sunac bonds trade at cash price around 20 and 30 cents on Friday. The company blamed the default on changes in China’s property sector since the second half of 2021, said IFR Asia. It inflicted a limited access to new financing. The company, on the other hand, continues actively to solve the issue.
The offshore and onshore debt restructuring financial adviser of Sunac is Houlihan Lokey. The legal adviser is Sidley Austin. The company planned a debt extension. Plus, it perennially discusses with the state-owned companies to join as strategic investors. Furthermore, Sunac refused to give comments. Actually, the company has tried many funding options. It raised HK$5.09bn from a top-up placement. Another top up follows for as much as $4.52bn early this year. It also sold a stake for as much as 5.1% in its property management unit Sunac Services in November last year for HK$2.33bn.
