Kaisa’s debt restructuring plan receives creditor approval

Kaisa Group, the Shenzhen-based property developer which defaulted on its USD-denominated bonds, reached a debt restructuring agreement approved by bondholders at meetings held by courts in Hong Kong and the Cayman Islands.

Based on an agreement reached last week, the company restructured nearly RMB 17bn in offshore debts

According to lawyers involved, 96% of shareholders by value attended the restructuring meeting and more than 99% voted to back the plan, exceeding the 75% threshold as per local law.

There remains a final legal process to obtain the US court’s recognition of Hong Kong and the Cayman Islands court sanctions, as the company was using US law to deal with offshore creditors.

The company expects the offshore restructuring to be completed by the end of June 2016.

Kaisa was on the verge of bankruptcy last year due to a liquidity crunch, but the situation improved after the Shenzhen government partially lifted the sales ban on its developments.

However, more than 1,000 apartment units owned by the company in Shenzhen remain seized.

Kaisa’s shares in Hong Kong have been suspended since March 2015.

Source:   South China Morning Post

Property developer Kaisa Group files for Ch-15 restructuring

Kaisa Group Holdings Ltd., a Shenzhen, China-based property developer filed a Chapter 15 petition (Case: 16-11303) in the Manhattan court on 5 May 2016. The company used this provision of U.S. bankruptcy law to deal with U.S. creditors or lawsuits when reorganizing in a Hong Kong court.

Kasia had $14.9bn in debt, backed by $16.1bn of assets.

Kaisa stated that holders of 96% of its offshore debt, supported the company’s restructuring agreement negotiated in the Hong Kong.

The company anticipates that the Hong Kong court will approve its restructuring plan.

Further, the company plans to meet with creditors on 20 May 2016.

Source: Bloomberg