Yuzhou Bondholders Plan to Take Legal Action; DaFa Properties Plans Debt Restructuring

Yuzhou Group said that certain parties who claim to hold minority interests in its 6% and 8.625% bonds that were due on January 25 and 23, 2022, informed the developer that they intend to start legal action if it does not redeem the old notes. Yuzhou only recently exchanged a chunk of the two bonds for new 7.8125% notes due 2023. Yuzhou’s dollar bonds are trading at ~17 cents on the dollar.

DaFa Properties is planning on a debt restructuring for its offshore bonds as soon as practicable, it said. This comes after a winding-up petition was filed against the developer regarding its $15mn 9.95% bonds due January 18, 2022.  DaFa added that it did not make a coupon payment of $22.275mn on its 12.375% bonds due July 2022 after its 30-day grace period expired, due to the petition. DaFa said, “it is necessary to ensure fairness to all its creditors by avoiding selective repayment”.