Date
17 December 2017
Kaisa Group's debt default will make foreign investors wary about Chinese property developers. Photo: www.kaisagroup.com
Kaisa Group's debt default will make foreign investors wary about Chinese property developers. Photo: www.kaisagroup.com

Kaisa may have defaulted on offshore bonds: WSJ

Shenzhen-based property developer Kaisa Group Holdings appears to have missed interest payments due on US$500 million of offshore bonds on Thursday, the Wall Street Journal reported, citing sources. 

Although the company has a 30-day grace period to pay after the due date, missing the deadline would put Kaisa in technical default, the report noted.

A default, if confirmed, would make Kaisa the first Chinese property company to default on offshore bonds, a development that would spark concerns among global investors.

On Jan. 1, Kaisa said it defaulted on a US$51.6 million loan from HSBC Holdings Plc. Credit rating agencies Standard & Poor’s and Moody’s Investors Service have downgraded the developer’s debt from just below investment grade to ratings that reflect an expected default.

Kaisa’s bond prices have plunged more than 80 percent since the end of November, and are now trading at around 33 cents on the dollar. Its stock price has fallen more than 60 percent over the same period, the report noted.

Trading in Kaisa shares has been halted since Dec. 29.

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RC

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