China home builder Country Garden gets HK$900 million private loan

COUNTRY Garden Holdings, one of China’s biggest property developers, has obtained a HK$900 million (S$152 million) loan from a private lender to refinance a bank loan, two people familiar with the matter said.

A large chunk of the loan, offered to a subsidiary of Country Garden by Hong Kong based investment company Flow Capital (HK), will be used to repay a Hong Kong loan owed by the developer, worth around HK$700 million, according to one of the two sources.

The new loan will have a two-year tenure and will be backed by guarantees from Country Garden’s listed parent company and a Hong Kong property, the two sources said. The interest rate charged by the lender was not immediately clear.

The loan came after Country Garden posted its first net loss since listing in 2007, as China’s property sector reeled under a debt crisis and sluggish sales.

Bloomberg earlier reported on Thursday afternoon that Country Garden had received the loan.

Country Garden declined to comment. Its shares fell 2 per cent on Thursday, taking its slump over the last year to around 60 per cent. REUTERS