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Reuters: Deutsche Bank plans to file liquidation suit against China Shimao Group

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Reuters: Deutsche Bank plans to file liquidation suit against China Shimao Group

China againreal estateThe business is facing the threat of collapse. Reuters reported today that Deutsche Bank is preparinghong kongChina filed liquidation proceedings against Shimao Group. Lu Media previously reported that Shimao had restructured US$11.7 billion of foreign debt, but failed to reach an agreement with creditors.

Reuters reports that Shimao Group was once one of China’s 20 largest real estate developers and was one of several Chinese real estate companies that defaulted on foreign bonds. In July 2022, the group failed to pay the principal and interest of US$1 billion of foreign bonds.

Deutsche Bank is one of Shimao’s lenders, the report said, citing two people familiar with the matter. After 18 months of discussions with lenders, Shimao submitted overseas debt restructuring terms to lenders in December last year, but Deutsche Bank deemed the terms unacceptable. There are plans to file liquidation proceedings within this month.

The report noted that if Deutsche Bank ultimately files a liquidation lawsuit against Shimao, it would be a rare occasion for a foreign financial institution to file a liquidation lawsuit against a Chinese real estate company since China’s real estate crisis in 2021 .

Deutsche Bank and Shimao did not respond to Reuters requests for comment.

According to previous reports from Lu Media Jimian News, Shimao Group announced in December last year that as of June 30, 2023, Shimao’s foreign interest-bearing debt was about US$14 billion, domestic interest-bearing debt was about US$25 billion , and accounts payable to related parties was approximately US$3 billion, and total equity is approximately US$9 billion, including non-controlling interests of approximately US$6 billion.

Based on this calculation, Shimao’s total interest-bearing liabilities are approximately US$51 billion.

Shimao explained in the announcement that it has been actively promoting the proposed restructuring of foreign debt in the past few months. This foreign debt restructuring scheme involves a total principal amount of approximately US$11.7 billion.

Reports at the time revealed that Shimao’s restructuring plan had not reached a final agreement with creditors.

In January, a Hong Kong court ordered the liquidation of China Evergrande Group. This is another Chinese real estate giantcountry gardenIn February, creditors also filed a liquidation application in a Hong Kong court. The market is worried that Country Garden could follow in Evergrande’s footsteps and deal another heavy blow to China’s already sluggish real estate market and economic situation.

China(TagstoTranslate)Hong Kong(T)Real Estate(T)Country Garden