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Shenzhen-headquartered Fantasia didn’t repay a $205.7 million bond that was due Monday, according to a company statement. Separately, property management company Country Garden Services Holdings Co. said that a unit of Fantasia failed to repay a 700 million yuan ($108 million) loan that also came due on Monday and that a default was probable.
Fantasia’s troubles add to signs that stress is spreading in China’s property sector, where lower-rated developers face a surge in bond yields to a decade high. Uncertainty over the full extent of Evergrande’s debt load, beyond its more than $300 billion reported in liabilities, has plagued investors since a liquidity crisis at the firm stoked fears of a collapse that could trigger financial and economic contagion.
Shares in Evergrande and its property management unit were suspended from trading Monday. Hopson Development Holdings Ltd., whose shares were also suspended, plans to acquire a 51% stake in Evergrande Property Services Group Ltd., according to Chinese financial news platform Cailian, citing unidentified people.
Trading of Evergrande was suspended pending an announcement on a “major transaction,” the developer said Monday in a stock exchange filing. Evergrande Property said it was halted before an announcement on a possible offer for shares in the company.
Key Developments:
Singapore Banks’ Loans to Evergrande Insignificant: MAS (7:56 a.m. HK)
Singapore banks’ loans to Evergrande are insignificant and their exposure to the Chinese property sector isn’t large, said Tharman Shanmugaratnam, senior minister and minister in charge of the Monetary Authority of Singapore.
Direct exposures to Chinese property are less than 1% of non-bank loans while those to Singapore property developers with operations in China are a further 2.5% of loans to non-bank customers, Shanmugaratnam said in reply to parliamentary questions on Monday.
Fantasia Holdings Skips Bond Payment Due Monday (10:40 a.m. NY)
Chinese developer Fantasia Holdings Group Co. said it hasn’t repaid a $205.7 million bond due Monday, intensifying investor concerns about the developer’s financial health. The company’s management and board “will assess the potential impact on the financial condition and cash position of the Group” stemming from the skipped payment, according to a statement Monday.
Fantasia Dollar Bonds Plummet Ahead of Maturity (5:12 p.m.)
Fantasia’s dollar bonds are plummeting as the company inches closer to a $208.2 million debt repayment deadline Monday. As uncertainty over the future of Evergrande weighs on credit markets, dramatic declines in Fantasia’s dollar bonds maturing later this year suggest rising concern over its capacity to service even its short-term debts.
Evergrande NEV Jumps 29% in Hong Kong (4:10 p.m.)
Trading continues in the developer’s vehicle unit, China Evergrande New Energy Vehicle Group Ltd. on Monday, with the stock closing up 29%, its biggest gain since Sept. 29.
Hopson’s Chu May Become Latest Tycoon to Bolster Evergrande (12:37 p.m.)
Another billionaire tycoon appears poised to come to the aid of embattled Evergrande.
The Chu family control Hopson Development and could become the latest wealthy family to help shore up finances for Evergrande, after Hopson reportedly agreed to buy a controlling stake in its property services business, according to Cailian. Chu Mang Yee is described as an “invisible magnate” by Chinese media.
Hopson Development Plans Evergrande Property Stake (11:53 a.m.)
Hopson Development plans to acquire a 51% stake in Evergrande Property Services, Cailian reported, citing unidentified people. That would give the management unit a valuation of more than HK$40 billion, Cailian said in an amended story. Hong Kong trading in Evergrande Property Services shares was suspended on Monday along with those of its parent.
Hopson Development’s USD Bonds Tumble (11:35 a.m.)
Hopson Development’s dollar notes are set for their biggest losses on record Monday after Cailian reported the firm plans to acquire a 51% stake in Evergrande Property Services. The company’s 6.8% dollar bond due 2023 sank 4.9 cents on the dollar to 90.2 cents, Bloomberg-compiled prices showed. The firm’s 7% note due 2024 declined 5 cents to 89.2 cents.
China Builder Sinic Faces Creditor Demanding $75 Million Payment (10:24 a.m.)
Amid heightened scrutiny on Chinese property firms as Evergrande contagion fears ripple through the sector, Sinic Holdings Group Co. received a demand to repay some debt after missing two local interest payments.
A creditor of the Chinese developer is demanding repayment of $75.4 million in outstanding principal and accrued interest, after the firm failed to repay 38.7 million yuan ($6 million) of interest on two onshore financing arrangements on Sept. 18, according to a Hong Kong stock exchange filing dated Sept. 30.
Evergrande dollar bond interest deadlines:
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