Refusing to "lie flat", the actual controller fully guaranteed the endorsement, and Sunshine City sought a debt extension

Source of this article: Times Finance Author: Zhang Wen

Image source: Visual China

In the face of short-term liquidity problems, some housing enterprises choose to "lie flat", and some are taking the initiative to take the initiative to seek ways to resolve the crisis.

On November 1, Sunshine City Group Co., Ltd. issued an announcement to make an exchange offer for three of its US dollar bonds and to obtain the consent of qualified holders to amend the relevant management contract of the above notes (hereinafter referred to as the "Exchange Tender Offer"). At the same time, Sunshine City proposed to solicit consent for the revision of the contract of the 5 bonds.

On the date of this announcement, Sunshine City proposes to make an offer for an exchange in exchange for a minimum acceptance of the outstanding principal amount of the Notes held by a Qualified Holder and, with the consent of the Eligible Holders, to amend the deed of the relevant Notes in accordance with the terms and conditions set forth in the Memorandum of Solicitation of Offers and Consents.

It is worth mentioning that the debt extension plan of Sunshine City has added the full guarantee of the actual controller, which fully demonstrates the sincerity and responsibility of Sunshine City in the debt extension offer.

A number of bond industry insiders said that in the market environment of some enterprises "lying flat", Sunshine City's approach shows the sincerity of communication with bondholders, and also fully implements the determination not to evade debts. Do not let the interests of creditors be damaged, and fulfill the main responsibility of debt.

Due to the tightening of real estate financial policies, the real estate industry has recently experienced a large-scale liquidity crisis, and Sunshine City has also been dragged down by this, but its fundamentals and production and operation have not changed substantially. According to the data released by the Kerry Real Estate Research Institute, the sales of Sunshine City reached 164.51 billion yuan in the first 10 months of this year, which was basically the same as last year in the case of the overall decline in the market.

Sunshine City said that it will do a good job in the overall resolution plan, take all necessary measures such as the sale of assets and project equity to ensure liquidity, safeguard the legitimate rights and interests of creditors in accordance with the law, and preserve the principal and interest of investors.

Its insiders revealed that at present, the company's production and operation are normal, and all employees have not hesitated or slackened off. The company has set up a special team to ensure the orderly operation of the company's main business, while strictly controlling the budget, reducing expenditure, increasing sales, and promoting the recovery of funds, so as to safely survive the short-term liquidity crisis.

In order to speed up the collection of sales, Sunshine City has recently made continuous moves in marketing, linking 300 projects in 100 cities across the country online and offline to open the Double Eleven Promotion.

For real estate enterprises, a good news is that the real estate credit policy environment is improving. At the third quarter 2021 regular meeting of the Monetary Policy Committee of the Chinese Bank held in September, it was clearly proposed to "safeguard the healthy development of the real estate market and safeguard the legitimate rights and interests of housing consumers"; at the annual meeting of the 2021 Financial Street Forum held in October, the State Council said that the reasonable capital needs of real estate are being met. These concentrated statements are seen as a further clarification of the real estate financing policy, and the real estate credit policy environment will usher in a certain degree of improvement.

Recently, the People's Bank of China has conveyed in various places the content of accurately grasping the policy requirements of prudent management of real estate finance, steadily carrying out real estate loan business and maintaining the smooth and orderly delivery of real estate credit, and branches of the People's Bank of China in some areas have begun to provide window guidance according to local conditions.

This also means that if the housing enterprises that have encountered a short-term liquidity crisis can maintain the stability of their operating fundamentals, there will still be opportunities in the future.