Chinese property firm Kaisa Group Holdings Ltd (佳兆業集團) yesterday suspended share trading in Hong Kong as questions swirl over its ability to make repayments and contagion spreads within the nation’s debt-ridden real-estate sector.
Kaisa, China’s 27th-largest real-estate firm in terms of sales, but one of its most indebted, became the latest company to spook investors when it announced on Friday that it had failed in a bid for a debt swap that would buy it crucial time.
Yesterday morning the firm announced that it was suspending trading in Hong Kong, where it is listed, “pending the release by the company of an announcement containing inside information.”
Photo: AFP
It is the second time the company has suspended trading in the past month.
Kaisa last month announced a plan to delay the repayment timeline for some of its bonds, offering an exchange for at least US$380 million of notes, which would have given it some room to find money further down the line.
However, the offer failed to win the 95 percent approval from bondholders needed for the plan to go ahead.
The company currently has about US$11.6 billion of US dollar notes outstanding.
It had defaulted on a US dollar debt in 2015, becoming the first Chinese developer to do so.
The most indebted Chinese property firm is China Evergrande Group (恆大集團), which set off the current confidence crisis earlier in the summer.
The Shenzhen-based behemoth racked up an eye-watering US$300 billion in loans before Beijing began to rein in the sector.
On Tuesday, Evergrande missed a deadline to repay some of its overseas creditors, raising the prospect of it defaulting as it prepares for a government-backed mega-restructure.
Bloomberg News reported some of the US$82.5 million in overdue coupon payments it owed by the end of Tuesday — when a 30-day grace period ran out — remained unpaid.
Ratings group S&P has predicted that a default by Evergrande is now “inevitable.”
Kaisa and Evergrande have become the most visible faces of the debt crunch within China’s property sector, but defaults have rippled throughout the sector.
Bloomberg News reported that at least 10 lower-rated real-estate firms have now defaulted on onshore or offshore bonds since the summer.
Chinese borrowers have so far this year defaulted on a record US$10.2 billion of offshore bonds, with real-estate companies accounting for 36 percent of those non-repayments, Bloomberg reported.
Wealthy owners of at least seven Chinese real-estate companies have also sold off some of their own luxury assets in the past few weeks to help prop up their firms, Bloomberg added.
After several years flying high as Asia’s best Nvidia Corp proxy, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is increasingly vying with other artificial intelligence (AI) stocks for investor attention. Stock traders are chasing a wider array of beneficiaries as mainstream usage of AI creates demand for hardware beyond the most-advanced chips TSMC makes for Nvidia. Subthemes from the deepening memory crunch to advances in robotics are also luring bids. At the same time, investment caps on single stocks are pushing funds to diversify, while retail investors long familiar with TSMC through its US depositary receipts are being offered a broader set of
UNDER MICROSCOPE: Taiwan detained three people who allegedly conspired to buy servers in Taiwan and export them using fraudulent documentation, prosecutors said Nvidia Corp chief executive officer Jensen Huang (黃仁勳) on Saturday urged Super Micro Computer Inc to tighten up on compliance after Taiwan detained three people this week for allegedly making fraudulent declarations about artificial intelligence (AI) servers made by its US partner. The development marked the nation’s first crackdown on semiconductor smuggling, which grew after the US slapped restrictions on exports of high-end chips such as Nvidia AI accelerators to China. Nvidia is “rigorous” in explaining regulations to all of its partners, Huang told reporters after arriving in Taipei. “Ultimately Super Micro has to run their own company,” he said in response to
Netherlands-based semiconductor equipment supplier ASML Holding NV yesterday said that it is planning to hire an additional 1,000 people in Taiwan this year in response to growing demand from clients. ASML had previously planned to recruit 600 people this year, but that the plan has been adjusted upward, ASML vice president and ASML Taiwan general manager Grace Wang (汪佳慧) told reporters. ASML has a workforce of more than 4,500 in Taiwan, accounting for about 10 percent of its global total, Wang said. This year’s recruitment campaign would focus on adding people in the customer support, manufacturing and supply chain domains to assist ASML
Nvidia Corp yesterday announced that CEO Jensen Huang (黃仁勳) would attend an employee meeting in Taipei tomorrow to celebrate the launch of the company’s Taiwan headquarters project. Huang would attend a gathering at the site of Nvidia’s planned headquarters in Beitou Shilin Technology Park (北投士林科技園區), the company said in a statement. After arriving in Taiwan on Saturday last week, Huang told reporters that he plans to meet with Quanta Computer Inc (廣達) chairman Barry Lam (林百里) and Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) chairman C.C. Wei (魏哲家), and would attend the groundbreaking ceremony for Nvidia’s Taiwan headquarters tomorrow. Nvidia has not yet applied
RSS