(Yicai) Nov. 6 -- Country Garden Holdings has secured creditor approval for its offshore debt restructuring plan, which the Chinese property developer said should pare its offshore liabilities by about CNY84 billion (USD11.8 billion).

A group of syndicated lenders voted 83.7 percent in favor of the plan, while 96 percent of other creditors also gave it their backing, more than the 75 percent required, the Foshan-based firm announced yesterday. The High Court of Hong Kong will hold a hearing on the plan on Dec. 4.

After rising by as much as 1.8 percent shortly after the market open in Hong Kong today, Country Garden’s shares [HKG: 2007] closed 3.5 percent lower at 55 Hong Kong cents (7 US cents) each.

The builder disclosed the plan’s key terms in January. It involves about USD17.7 billion in principal and interest and offers creditors options: cash payment, full debt-to-equity conversion, full debt retention, and a combination of debt-to-equity conversion and debt retention.

Last month, the company’s controlling shareholder further signalled their commitment by fully converting hundreds of million of US dollars in existing shareholder loans into equity, Country Garden pointed out.

Country Garden, which defaulted on offshore bonds in late 2023, is the second major Chinese developer to achieve notable progress in its offshore debt restructuring. Sunac China Holdings also said yesterday that the same court had greenlit its second overseas debt restructuring plan, involving about USD9.6 billion of offshore liabilities.

Country Garden is also pushing forward with an onshore debt restructuring, Yicai learned. Once approved by creditors, that plan would more than halve the firm’s debt, obviate repayment for five years, and lower the bond interest rate to 1 percent, significantly alleviating cash flow pressure.

While tackling debt, Country Garden remains focused on its core business of building and delivering homes. It had delivered around 130,000 new homes this year as of the end of Sept. 30, and more than 1.8 million in the past three years, according to figures from China Real Estate Information.

The real estate data providers and consultancy firm estimates that Country Garden should be able to achieve its annual delivery target of 200,000 to 210,000 new homes this year.

Editors: Tang Shihua, Futura Costaglione