22-05-2025
New World Gets Support From About 10 Banks for Loan Refinancing
(Bloomberg) -- New World Development Co. has secured commitments from about 10 banks for its HK$87.5 billion ($11.2 billion) loan refinancing, according to people familiar with the matter, as the cash-strapped builder races to complete the deal before the end of next month.
Major banks Bank of China Ltd., HSBC Holdings Plc and Standard Chartered Plc, local lenders Bank of East Asia Ltd., Fubon Bank (Hong Kong) Ltd., Hang Seng Bank Ltd., and French lender Credit Industriel et Commercial along with several other financial institutions have completed the internal approval process to join the deal, with total commitments exceeding HK$20 billion, the people said. More banks are going through internal credit approvals and expect to finalize their commitments in the coming weeks, they added.
New World has invited over 50 existing bank lenders to join the transaction, they said.
While New World is eager to complete the refinancing and bolster its liquidity, a transaction with such a large number of participants can take time to process. Commitments from most of the lenders involved have yet to be finalized, but many bankers expect that the deal will eventually come together, the people said. Some banks are waiting for lenders with greater exposure to New World to sign on before they can secure their own internal approvals, the people added.
HSBC and Standard Chartered declined to comment. New World, Bank of China, Bank of East Asia, Fubon Bank, Hang Seng and Credit Industriel et Commercial didn't immediately respond to requests for comment.
New World is under pressure to complete the deal by the end of June as a covenant waiver on its existing facilities is set to expire. The initial deadline for banks to finalize their commitments for the refinancing was the end of May, but some lenders have indicated they need additional time to secure internal credit approvals, Bloomberg News reported earlier.
If the waiver expires before a refinancing deal, some banks could demand immediate repayment, though that scenario is unlikely, Bloomberg News earlier reported.
New World, controlled by the family empire of tycoon Henry Cheng, has been in discussions with banks since January seeking to refinance its bank borrowings maturing this year and beyond.
The company also has multiple bond coupon payments due in June that will be closely watched by investors. It had total liabilities of HK$210.9 billion at the end of December 2024 and in June it has at least $116.6 million of coupon payments due, including on four perpetual notes.
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