Modern Land shares plunge after some bondholders demand early redemption

HONG KONG, Jan. 10 (Reuters) – Shares of Chinese developer Modern Land (1107.HK) plunged nearly 40% to all-time lows when trading resumed on Monday after announcing it was in talks with carriers notes on a restructuring plan for its $ 1.3 billion offshore bonds.

Modern Land said on Monday it had received notices from certain noteholders requiring early redemption of their senior notes, after the company defaulted on payment of its 12.85% notes due on October 25, 2021.

The shares, suspended since Oct. 21, fell nearly 40% in business hours in Asia to HK $ 0.23, an all-time low.

The developer said he has been in discussions with these creditors for a waiver and has appointed financial advisers to formulate a comprehensive plan of feasible remedies.

Chinese developers face unprecedented cash shortage due to years of regulatory restrictions on borrowing, leading to a series of overseas defaults, credit rating downgrades and sales of stocks and bonds developers.

China Evergrande Group (3333.HK), the world’s most indebted developer with more than $ 300 billion in liabilities, calls for six months to redeem and pay coupons on 4.5 billion bond. yuan ($ 157 million) at a meeting with incumbents. The outcome of the meeting is expected later Monday. Read more

Shimao Group Holdings (0813.HK), which defaulted on a fiat loan last week, has put all of its real estate projects up for sale, including residential and commercial properties, reported Caixin. Read more

The Shanghai-based real estate developer has reached a preliminary deal with a Chinese state-owned company to sell its Shimao International Plaza Shanghai, a commercial property on Nanjing Street in Shanghai, for more than 10 billion yuan, according to the report.

The company did not immediately respond to a request for comment.

As of 02:07 GMT, shares of Evergrande fell 2.8%, while Shimao gained 5.3%.

Reporting by Clare Jim and Donny Kwok; Editing by Kim Coghill & Shri Navaratnam

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