(Yicai) Dec. 23 -- China Vanke’s shares dropped after the troubled property developer said bondholders rejected its latest plan for delaying repayment of a CNY2 billion (USD280 million) note that matured on Dec. 15. They approved a proposal to lengthen the grace period.

Vanke [SHE: 000002] finished 2.8 percent lower at CNY4.79 (68 US cents) per share in Shenzhen today, while its Hong Kong-traded stock [HKG: 2202] closed down 2.3 percent at HKD3.46 (45 US cents). The firm’s bonds ended mixed, with 21 Vanke 02 tumbling 7.1 percent, 22 Vanke 02 dipping 1.4 percent, 22 Vanke 04 falling 4.3 percent, and 22 Vanke 06 climbing 6.6 percent.

Seventy-eight percent of bondholders voted against Vanke’s second proposal to extend repayment of 22 Vanke MTN004, the medium-term note’s trustee Shanghai Pudong Development Bank announced yesterday on the website of the Shanghai Clearing House. But they approved the request to lengthen the grace period to 30 business days, taking it to Jan. 28.

Vanke accepts the outcome of the voting and will continue to engage with all parties to seek a solution and safeguard their long-term common interests, the Shenzhen-based company said in a statement yesterday.

On Dec. 5, Vanke had proposed three options for extending repayment of 22 Vanke MTN004: a 12-month delay, the addition of irrevocable full joint liability guarantees from major shareholder Shenzhen Metro Group, or other collateral measures acceptable to investors provided by other state-owned enterprises in the city. All three were rejected on Dec. 14.

Three days later, Vanke put forward a second plan that would have delayed repayment of the bond’s principal by 12 months and accrued interest at an annual rate of 3 percent, with CNY60 million (USD8.5 million) in overdue interest to be paid by Dec. 22. The firm also pledged to provide additional credit support.

On Dec. 17, Vanke proposed five options to extend a second CNY3.7 billion (USD526.4 billion) bond maturing this month. 22 Vanke MTN005 falls due on Dec. 28.

Each option extends maturity by 12 months. Four require Vanke to provide credit-enhancement measures, with different repayment methods for the principal and interest. Vanke held the first bondholders meeting to extend 22 Vanke MTN005 on Dec. 22, with the deadline for voting set at 3 p.m. on Dec. 25.

Editors: Tang Shihua, Futura Costaglione