(Yicai) Nov. 21 -- Shares in Sunac China surged by as much as 26.6 percent after the Chinese property developer said yesterday that its USD10 billion overseas debt restructuring is complete, and relieves liquidity pressure for the next 2-3 years. 

Sunac’s share price [HKG: 1918] was trading up 18.8 percent at HKD2.77 (USD0.36) as of 2 p.m. today, giving it a market capitalization of HKD15 billion (USD1.9 billion). Earlier in the day it hit HKD2.95. Yesterday it closed up 5.9 percent.

Sunac, which first defaulted in May 2022, filed for Chapter 15 bankruptcy in New York in September to protect it from lawsuits and having its assets frozen while it set about reorganizing its debt. The Tianjin-based company offered creditors a number of options, such as the swapping of old notes with new ones, issuing convertible bonds and converting part of the debt to shares in its property management arm Sunac Services.

It has now been agreed that Sunac will issue creditors with USD5.7 billion of new notes, USD2.7 billion of mandatory convertible bonds, USD1 billion of convertible bonds and USD775 million of shares in Sunac Services, said Sunac, whose sales halved in the first 10 months from a year earlier to CNY75.8 billion (USD9.7 billion).

The new notes, mandatory convertible bonds and convertible bonds, are expected to be listed on the Singapore Exchange on Nov. 21. Once the transfer of equity in Sunac Services is complete, Sunac’s equity will be diluted to 49.7 percent but it remains the majority shareholder.

Since the second half of 2021, over 50 real estate firms listed on the mainland have started overseas debt restructuring, according to incomplete statistics.

Editor: Kim Taylor