Kunpeng Project
The big hole dug by Boss Xu may be difficult to fill in for a while. Focusing on the difficult issue of Evergrande's overseas debt restructuring, the parties have not yet reached an agreementOn December 15, Evergrande issued an announcement, saying that the debt restructuring support agreement signed in early April this year has expired, and the review and approval time of the agreement will not be extended, and the follow-up company will issue a new restructuring announcement according to the progress of the work. This also means that the offshore debt restructuring plan, which has been in the making for more than half a year and has been postponed three times, has finally come to an abrupt death. Although Evergrande said that it will continue to negotiate with relevant parties and strive to reach an agreement eventually, from the current situation, the possibility of reaching an agreement is very slim.
Now Evergrande's biggest trouble is not its domestic debts, but the huge scale of overseas debts, which have domestic banks as guarantors, which is also the most incredible pointEvergrande's nearly $20 billion overseas bonds are all issued by domestic banks, and there is not even a single foreign bank. If a debt restructuring plan cannot be reached, and the company is ultimately unable to repay its debts, it will be equivalent to dumping the pot on the state-owned banks, and the creditors will be directly affectedAsk the guarantor for money, evenIt is possible to apply for the freezing of the guarantor's account and funds, and at the same timeAffect the credibility and reputation of domestic banks internationally。If you pay it back, the only way is to do itAuction of Evergrande's house, which is bound to beIt seriously affects the interests of domestic home buyers and merchants, the plan to ensure the delivery of the building can only come to naught, and the follow-up will trigger a series of chain reactions, so some people joke that Evergrande's debt problem may change the fate of many governors.
According to the information that has been disclosed, Evergrande's overseas debt is mainly composed of two parts, the majority of which is Evergrande itself as the main body of bond issuance, which includes two categories, one is a total of 139US$22.5 billion of senior secured notes, also known as Group A, and the other category is offshore financial liabilities (such as borrowings, repurchase agreements, margin loans, etc.), also known as Group C;The other part is to Jingcheng *** as the main body of bond issuance, and the total amount of bonds issued is 52US$2.6 billion, the company is also a wholly-owned subsidiary of Evergrande.
Correspondingly,The plan will also complete debt restructuring through a combination of new notes and debt-to-equity swaps, specifically,Evergrande will issue new bonds to replace existing bonds, with maturities ranging from 4 to 12 years and interest rates ranging from 2% to 7 per annumBetween 5%, no interest is paid for the first three years, and 05%。Although the debt restructuring plan was available, various variables appeared in the follow-up, resulting in the restructuring meeting having to be postponed many times, the most fatal of which was that Evergrande was investigated by the Securities Regulatory Commission and Boss Xu was imprisonedEvergrande lost its qualification to issue new notes
Hanging over Evergrande's head along with debt restructuring isThe winding-up hearing petition brought by the creditor Jiasheng Global involved an amount of about 8HK$62.5 billionHowever, fortunately, the High Court of Hong Kong granted Evergrande's application for an adjournment and the winding-up hearing will be heardpostponed to the end of January 2024, which already counts7th postponementFinish. Although Evergrande can take a breather for a while, it should not be taken lightly, after all, the respite time is only more than one month, when Evergrande is ordered to liquidate, then the court will appoint a liquidator to take over the company, auction assets to pay off debts.
Compared with bankruptcy liquidation, the best answer is, of course, debt restructuring, after all, the company is still there, and there is still hope for everything to turn around, but with the current state of the company, it is difficult to give creditors a satisfactory answerEvergrande's main revenue in the first half of the year was about 1281800 million yuan, with a net loss of 392500 million yuan, as of June 30, after excluding contract liabilities, Evergrande's total liabilities are still as high as 178 trillion yuan, the company's cash and cash equivalents are only 404.7 billion yuanCreditors are increasingly worried about Evergrande's future, so it is difficult to accept Evergrande's new proposal.
It can be seen that Evergrande's top priority, in addition to ensuring the delivery of the building, must also deal with the imminent debt problem to avoid bankruptcy liquidation, which is also the key factor that determines whether the company can regain its life in the future.