Alibaba-backed property brokerage E-House’s debt revamp plan approved by 75 per cent of bondholders

Name: Boom, bust and borrow: Has China’s housing market tanked?
Uploaded: 2023-07-26T09:14:22.000Z
Duration: 10 min 57 s
Description: Boom, bust and borrow: Has China’s housing market tanked?

E-House (China) Enterprise Holdings is restructuring two bonds in default totalling US$600 million

Backers of the debt restructuring plan will receive US$60 in cash and US$940 in new bonds maturing in 2025 for every US$1,000 owed

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The easing of the Chinese government’s stance on the real estate sector has boosted investor sentiment. Photo: AFP

Zhang Shidongin Shanghai

Published: 5:14pm, 26 Jul 2023

Creditors of E-House (China) Enterprise Holdings have approved a debt restructuring plan, paving the way for the property brokerage and consultancy to finalise a solution on bond defaults totalling US$600 million.

The Shanghai-based company, which is backed by Alibaba Group Holding, received support from 75.6 per cent of the bondholders, according to a filing to the Hong Kong exchange on Wednesday. E-House will file petitions with the courts in the Cayman Islands and Hong Kong to commence the restructuring around July 31, it said.

The rest of the creditors can still submit their decisions on the restructuring plan to the company until the end of the month, the statement said. Those backing the plan will get US$60 in cash and US$940 in new bonds maturing in 2025 for every US$1,000 owed, while the company will raise cash through stock sales and asset disposals, according to the restructuring arrangement.

The company, in which Alibaba has an 8.3 per cent stake as its No. 5 shareholder, defaulted on a US$300 million 7.62 per cent note that matured in April 2022, and on a US$300 million 7.6 per cent bond due last month, following Beijing’s crackdown to curb developers’ leverage and soaring home prices, dragging the industry into a downward spiral. Alibaba also owns the Post.

10:57

Boom, bust and borrow: Has China’s housing market tanked?

Shares of E-House surged by as much as 13 per cent to HK$0.255 in Hong Kong on Wednesday before paring the gain to 6.7 per cent. The stock has lost nearly 98 per cent of its value from a record high set on December 31, 2018.