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Bond Market News
CFLD Presents Restructuring Plan for $2.8bn of Debt
October 18, 2024
China Fortune Land Development (CFLD) has proposed a new debt reduction plan to its local creditors. As per the latest proposal, it has given its creditors an option to transfer their debt to an unnamed SOE in Langfang. CFLD would transfer an unknown amount of assets, including receivables to the firm. Eligible creditors must provide new loans, equivalent to their debt holdings to the SOE, with an 8Y term and an interest rate capped at 3.85%. The company aims to reduce its debt by approximately RMB 20bn ($2.8bn) after the completion of the new plan. The previous plan involved selling debt at a 90% discount to a private firm without requiring new loans from creditors. CFLDA has restructured over RMB 190bn ($26.7bn) of debt till date, but faces challenges in asset sales, prompting the need for this new approach.
Its dollar bonds continue to trade at deeply distressed levels of 4 cents on the dollar.
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