雅虎香港財經 China Builder Agile Defaults for First Time on Dollar Bonds
(Bloomberg) -- Agile Group Holdings Ltd., a Chinese developer of villa apartments and high-rise homes, defaulted for the first time on publicly issued dollar bonds, underscoring lingering distress amid the nation’s unprecedented property crisis.
Most Read from Bloomberg
Trump Vows ‘Day One’ Executive Order Targeting Offshore Wind
Macron Puts French Banks in Play With Plan to Transform Europe
Five Under-the-Radar Billionaires Making Vast Fortunes in Modi's India
Tesla Rehires Some Supercharger Workers Weeks After Musk’s Cuts
The company, based in the southern province of Guangdong, hasn’t paid interest within a grace period that ended May 13 on dollar bonds due 2025, it said in a filing. The builder will engage an external financial adviser and legal adviser to assist in evaluating the capital structure and liquidity.
Some of the firm’s notes — already trading at deeply distressed levels around 9 cents — dropped further to around 5 cents on Tuesday afternoon. The stumble adds to record defaults among Chinese property developers, flagging the long road to recovery even as recent policy steps to support the housing industry have sparked rallies in builder shares and bonds. Some analysts have voiced skepticism as to whether the wave of stimulus measures could lift sales.
Agile’s default also marked the downfall of one of the few survivors among China’s private-sector builders. The list of major private developers that have yet to default on public bonds has dwindled since last year, after the delinquency of Country Garden Holdings Co.
“This is a surprise given the company’s 2023 financial still showing 12.6 billion yuan ($1.7 billion) of cash balance, [and its] track records to meet obligations at the last minute,” wrote credit analysts at BNP Paribas SA in a commentary seen by Bloomberg News.
Agile’s shares fell as much as 17% in Hong Kong Tuesday to 58 Hong Kong cents and were set for their biggest daily decline in more than nine months, Bloomberg-compiled data show. A Bloomberg index tracking Chinese developers’ stocks fell 1% after gaining 20% in the previous three trading days.
The real estate industry “continues to experience a downward trend,” Agile said in its filing.
Like many builders in China, Agile often sells homes before they are completed. Pre-sales of homes for the four months ended April 30 fell 68% to 6.55 billion yuan ($905 million) compared with the year-earlier period, it said. The firm is considering all possible actions to address its debt issue, it added.
With total assets of more than 240 billion yuan as of the end of last year, Agile has established a presence in more than 200 cities in China and abroad and employs over 100,000 staff members, according to its website.
Some holders of the 6.05% dollar notes due 2025 said Monday they hadn’t received the interest payments, as the 30-day grace period neared its end. The bond’s offering circular defines an “event of default” when non-payment of interest continues for a period of 30 consecutive days.
--With assistance from Alice Huang and Pearl Liu.
(Updates with bond prices in the third paragraph, adds analyst commentary in the sixth paragraph)
Most Read from Bloomberg Businessweek
How the ‘Harvard of Trading’ Ruined Thousands of Young People’s Lives
Cheap Prison Labor Is Keeping People Locked Up Longer, Suit Alleges
US East Coast Ports Are Spending Billions to Profit From Asia’s Shifting Exports
‘The Caitlin Clark Effect Is Real,’ and It’s Already Changing the WNBA
©2024 Bloomberg L.P.
