(Yicai) Aug. 20 -- Kaisa Group Holdings has managed to thrash out a deal with a creditors group to support the offshore debt reorganization of the embattled Chinese property developer, marking a major step in giving Kaisa the space and financial flexibility it needs to keep operations stable.

Creditors, which hold over 34 percent of Kaisa's offshore debt as well as more than 36 percent of the debts of its unit Rui Jing Investment, have come to an agreement, Kaisa said yesterday. The Hong Kong-based developer first approached its creditors in October last year with an aim to restructure.

Kaisa plans to issue six tranches of US dollar-denominated senior notes, that will mature between Dec. 28, 2027 and Dec. 28, 2032 with an annual yield of between 5 percent to 6.25 percent, as well as eight batches of non-interest-bearing US dollar mandatory convertible bonds due between Dec. 31, 2025 and Dec. 31, 2032, according to updates on its offshore debt restructuring progress.

For the restructuring to be a success it requires broad support, said Kaisa, which defaulted on CNY300 million (USD42 million) worth of wealth management products and USD12.3 billion of offshore bonds in December 2021. All creditors who have not yet signed the restructuring support deal should join as soon as possible, it added.

But there is a long road to recovery ahead for Kaisa. The company’s losses expanded 51.4 percent last year from the year before to CNY19.7 billion (USD2.8 billion), while revenue climbed 3 percent to CNY26.2 billion, according to its latest annual results.

The firm only had CNY3.4 billion (USD476.1 million) in cash or cash equivalents as of Dec. 31 last year. But it had racked up debts of CNY133.6 billion (USD18.7 billion), CNY117.1 billion of which needs to be paid back in the next 12 months.

Editor: Kim Taylor