Agencies and staff reporter
Country Garden (2007) said it might not be able to meet all of its offshore payment obligations when due or within the relevant grace periods, as the country's largest private property developer grapples with debt restructuring.
Such non-payment may lead to relevant creditors demanding acceleration of payment or pursuing enforcement action, the company said in a Hong Kong Stock Exchange filing yesterday.
Country Garden, which has US$10.96 billion (HK$85.49 billion) of offshore bonds and 42.7 billion yuan (HK$45.8 billion) worth of offshore loans, said it was facing "significant" uncertainty regarding the disposal of assets and its cash position remained under pressure.
The developer said it had appointed Houlihan Lokey, China International Capital Corporation, and law firm Sidley Austin as advisers to examine its capital structure and liquidity position and formulate a holistic solution.
The company added it will work with advisers to develop the most pragmatic and optimal solution for all stakeholders, and called for patience from creditors.
Country Garden's warning came after it managed to dodge its first public bond payment failure and succeeded in rescheduling local debt in recent months.
Meanwhile, Kingboard (0148) said Country Garden has failed to repay a loan with an outstanding principal of nearly HK$1.6 billion and an impairment loss on it may incur.
The HK$1.88 billion loan borrowed in 2021 was to be repaid in installments with the last one in December this year.
The builder issued an additional 1.25 percent new shares to repay HK$270 million in August but failed to make other repayments..
This came as Li Changjiang, president and executive director of Country Garden Services (6098), has recently tendered his resignation to the company, according to Chinese media outlet Cailian, adding that his posts will be succeeded by Xu Binhuai, deputy general manager and chief strategy officer of the firm. Li will serve as a consultant after his resignation, the report added.
Li had offloaded 3.2 million shares of the company in July to cash out over HK$28 million and saw his stakes reduced to 0.11 percent.
Meanwhile, a Hong Kong court said Pan Sutong, former chairman of bankrupt Goldin Financial (0530), owed the Shenzhen branch of Bank of China (3988) as much as 56 billion yuan.
Country Garden is asking its creditors to be patient. Reuters
