By Clare Jim
HONG KONG (Reuters) – Cash-strapped Chinese property developer Shimao Group Holdings on Tuesday denied a media report that it has entered into a preliminary agreement to sell a Shanghai plaza, but said it was in talks with potential buyers to sell some properties.
The Shanghai-based developer said last week that it had defaulted a trust loan after missing a 645 million yuan ($101.10 million) payment that it guaranteed, is now struggling to raise funds while discussing payment arrangements with creditors.
In a filing to the stock exchange, Shimao denied a report over the weekend by financial publication Caixin saying that it had struck a preliminary deal to sell its Shimao International Plaza Shanghai to a state-owned company for more than 10 billion yuan.
But company did say that it “may consider disposing of certain properties if the terms and conditions are appropriate in order to reduce the indebtedness of the group.”
The Caixin report had said that Shimao has put on sale all of its real estate projects, including both residential and commercial properties, and it is also in talks with China Vanke to dispose some assets.
As of 0610 GMT, shares of Shimao reversed early losses to edge up 0.7%, following a gain of 19% in the previous session.
Reuters reported last week Shimao’s unit Shanghai Shimao Construction has proposed extensions on maturities for two ABS due this month totalling 1.17 billion yuan.
In the filing, Shimao said it has no outstanding asset-backed securities (ABS) due and payable as of Tuesday.
OTHER TROUBLED DEVELOPERS
Separately, smaller rival Guangzhou R&F Properties also issued a filing to the stock exchange updating investors on its attempts to reach agreement to settle debt.
After 95.9% of investors holding $725 million of offshore notes tendered to sell their notes back to the company, the firm said last week that it had materially less than the $300 million that it had expected to be available for settlement, without specifying how much it had.
On Tuesday, Guangzhou R&F Properties, which is seeking to extend maturity of the notes by six months, said it will use $104 million to pay fees for the bondholders’ consent and the tender offer.
After the settlement, the 5.75% notes will have an outstanding of $608.6 million and the new maturity date will be July 13, it said.
R&F shares rose 1.8% while China Evergrande Group was flat.
Evergrande, struggling to repay more than $300 billion in liabilities and set to be China’s biggest defaulter, said late on Monday that the voting period for onshore bondholders meeting will be extended to Jan. 13 from Jan. 10.
The developer is seeking a six-month delay in the redemption and coupon payments of a 4.5 billion yuan ($157 million) bond.
($1 = 6.3715 yuan)
(Reporting by Clare Jim; Editing by Muralikumar Anantharaman, Shri Navaratnam & Simon Cameron-Moore)