Cash-strapped developer Goldin seeks to raise another HK$8.7 billion in loans and sell Kai Tak site to pay piling debts

The company, once one of the most aggressive asset acquirers in Hong Kong, said it would raise a new loan of HK$8.7 billion without elaborating

Goldin sold a waterfront residential plot at the city’s former airport site for a net loss of HK$2.57 billion after fees

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The former Kai Tak runway site in January 2019. Photo: Martin Chan

Published: 3:14pm, 16 Jul 2020Updated: 11:01pm, 16 Jul 2020

Goldin Financial Holdings, which staged a spectacular U-turn in 2018 from buying Hong Kong’s most expensive waterfront land, said it is actively looking for capital to repay a growing pile of debt, as its stock lost nearly 70 per cent in value since October.

The company, controlled by billionaire Pan Sutong, said it has been “in active discussions” with creditors since March to repay its loans, and has come up with two solutions to refinance its debt, according to the developer’s filing to the Hong Kong stock exchange.

The company, once one of the most aggressive asset acquirers in Hong Kong, said it would raise a new loan of HK$8.7 billion (US$1.12 billion), without elaborating. The company sold a waterfront residential plot at the city’s former airport called Kai Tak Area 4B Site 4 for HK$7.04 billion in May, incurring a net loss of HK$2.57 billion after fees and financing costs are added.

“The proceeds from the disposal would be primarily used to reduce the group’s borrowings, thereby enhancing its financial flexibility as a whole,” Goldin said in a filing. Its stock plunged by as much as 25.4 per cent on the Hong Kong exchange to a record low of 94 HK cents, tumbling 70 per cent from HK$3.22 on October 8.

Pan Sutong, billionaire developer and owner of a race horse, draws the barrier No 10 at Sha Tin Racecourse Parade Ring on December 8, 2016. Photo: SCMP

The developer is owned by the 22nd-richest man on Forbes’ Hong Kong Rich List this year, with Pan’s wealth estimated at US$3.9 billion. The company had been on a shopping spree for assets since 2016, when it paid HK$6.38 billion for a residential plot in Ho Man Tin in March of that year, while bidding for a HK$10 billion luxury home project at the subway station in the same district.

Next on its acquisition list was land at Kai Tak, where Hong Kong’s old airport was located, with the former runway jutting into Victoria Harbour with a 270-degree seafront view. Luckin bought Kai Tak Area 4B Site 4 for HK$8.91 billion in November 2018, and bought a commercial site there for HK$11.1 billion in May 2019.

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