Kaisa’s desperate offshore bondholders offer to buy US$1 billion worth of its onshore loans in latest bid to rescue embattled developer
- The bondholders have offered to buy Kaisa’s non-performing loans from its onshore creditors, including banks
- The offer, if accepted, will improve their loan recovery chances in case of a liquidation
New Money Consortium, a group of eight institutions holding more than US$2.5 billion worth of Kaisa’s US dollar bonds, has offered the new solution to the cash-strapped developer while waiting for it to disclose more details of its financial position, sources close to the matter told the Post.
The consortium has offered to buy Kaisa’s non-performing loans from its onshore creditors, including banks, the sources said. This manoeuvre will also improve their loan recovery chances in case of a liquidation.
The consortium also offered an eight-page forbearance proposal on December 6, hoping to talk to Kaisa. The developer has, however, so far not taken any actual action in settling with offshore creditors, despite several zoom meetings and calls, sources said.
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The bondholders have been keen to bail out the Chinese developer as they want to prevent any disorderly enforcement by Kaisa’s onshore creditors, which could be value destructive for all stakeholders, the people familiar said. By giving Kaisa extra money and time for it to complete its projects and restore normal business operations, they hope to help it power through its current liquidity crisis and be able to repay its bondholders.