Country Garden gets more time for US$14.1 billion restructuring
[HONG KONG] Chinese developer Country Garden Holdings was given more time by a Hong Kong court to work on its US$14.1 billion offshore restructuring after amassing additional creditor support for the plan.
High Court Judge Linda Chan adjourned a liquidation hearing against the company to Aug 11, taking into consideration the amount of the debt and number of creditors involved, and said she would like to see some 'useful and good progress' in the next hearing.
The defaulted builder, once China's largest by contracted sales, has said that it has so far secured backing from holders representing over 70 per cent of its debt. Bank creditors, however, had yet to sign on to the plan as at May 22, Bloomberg reported earlier.
The company and bondholders had asked for a six-month extension to the hearing, while bank creditors sought a three-week reprieve.
Country Garden has been in talks with creditors since it defaulted on its US dollar debt about 19 months ago. The company received a liquidation petition in early 2024, adding urgency to what is one of the biggest restructurings of a Chinese developer since the beginning of the real estate crisis. It has previously said that it aims to complete the restructuring in December.
The company needs the support of creditors holding three-quarters of all debt as well as majorities of individual groups of debt holders to pass the plan through a 'scheme of arrangement' procedure.
The builder said in April that it was close to finalising negotiations with the seven banks that make up a key group called the co-ordination committee, comprising long-term business partners of the developer. The committee holds or controls about 48 per cent of three syndicated loans with total principal of US$3.6 billion, according to a company filing. BLOOMBERG
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