HONG KONG: Shimao Property said on Monday (Jul 3) it may include its hotel in Hong Kong as a sweetener in its offshore debt restructuring, instead of selling the property.
Shimao, the first major Chinese developer to kick off formal negotiations on restructuring terms with creditors, had initially proposed a plan in August to repay a total of US$11.8 billion of offshore debt over a period of three to eight years, but details still have not been finalised after 10 months.
The Shanghai-based developer, which defaulted on its first offshore payment last July, had been seeking to sell the Sheraton & Four Points by Sheraton Tung Chung Hotel, located close to the international airport, since March to fetch at least US$828 million, according to its sales agent JLL.
But in a filing on Monday, Shimao said it had in June successfully entered into a definitive agreement to restructure the loan facilities of the hotel, which might form part of the asset package as a supplemental credit enhancement for the restructuring proposal.
The company added that together with an ad hoc bondholder group and an offshore bank committee, the parties were still in the process of narrowing differences on various issues under the restructuring proposal.
With an outstanding US$6.1 billion in international bonds, Shimao was the sixth-largest issuer among Chinese developers, according to Refinitiv.
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