NewSunac's chairman puts past failures behind him as Kaisa's white knight
Sunac boss puts past failures behind him and comes to the rescue of cash-strapped developer in a bid to expand company into the south
Two decades ago, Sun Hongbin was in prison and fighting to overturn a conviction on charges that he had embezzled company funds.
Today, the chairman and chief executive of Sunac China Holdings, the Tianjin-based developer he founded in 2003, is one of the country's wealthiest business executives. He is also rescuing cash-strapped Kaisa Group Holdings, which was at risk of becoming the first mainland real estate company to default on its US dollar-denominated bonds.
In recent months, Kaisa's financial squeeze has been followed closely by global bond investors. Mainland companies raised US$244 billion in dollar note sales last year.
Sunac has signed an agreement to buy 49.25 per cent of Kaisa from the family of former chairman Kwok Ying-shing for HK$4.55 billion.
Sun said he planned to pay the US$23 million interest due on Kaisa's 10.25 per cent dollar bonds that it missed last month. "If Kaisa collapses, there's no winner," he said. "But if it's done well, it's a win-win."
Sun has had tangles with the law, according to details in a sales prospectus for bonds Sunac sold in October 2012. The conviction that landed him in prison was overturned on appeal in 2003, though in a retrial, it was affirmed that his actions were in breach of internal financial management systems.