Linklaters advises creditors on Sunac China's $80.07b debt restructuring agreement

The agreement allows the company to extend the debt's maturity.

Linklaters advised an ad hoc group of bondholders and lenders on a debt restructuring agreement with Sunac China.

The ad hoc group holds over 30% of the property developer's outstanding offshore debt worth US$10.2b (HK$80.07b).

The agreement will facilitate the restructuring via one or more schemes of arrangement in Hong Kong, together with recognition proceedings in other relevant jurisdictions.

The restructuring will allow Sunac China to extend the maturity of its offshore debt by two to nine years and de-lever via conversion of certain of its existing indebtedness into a convertible bond worth US$1bn (SG$7.85b); up to US$1.75b (HK$13.74b) mandatory convertible bonds; and 14.75% of Sunac Services' shares.

It will also provide for the equitisation of certain shareholder loans, cash sweeps from onshore and offshore asset disposals, enhanced governance, and other information rights.

The restructuring will give Sunca China a long-term and sustainable capital structure that will enable it to stabilise its business and protect value for all stakeholders.

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