Chinese developer Sunac gets loan from Huarong as support ramps up
SUNAC China Holdings secured funding for one of its property units from a government-backed asset manager, in a further sign of support for the beleaguered real estate sector in China.
Shanghai Haolong agreed to a three-year loan of up to 3.5 billion yuan (S$657.4 million) for a homebuilder half-owned by a Sunac subsidiary, according to an exchange filing on Tuesday (Nov 21). Haolong is partially backed by China Huarong Asset Management, one of China’s biggest bad-debt managers.
China is stepping up support for the sector, after a string of debt defaults and plunging home sales accelerated a slowdown in the world’s second-largest economy.
Regulators are drafting a list of 50 developers eligible for a range of financing, Bloomberg News reported on Monday, citing unidentified people familiar with the matter. China Vanke and Longfor Group Holdings are among companies that have been named in a draft of the so-called white list.
Sunac, the nation’s third-largest developer in 2021, was among the developers that defaulted, and this week became one of the first to complete a debt restructuring. The firm won court approval for a plan that covers an estimated US$10.2 billion of creditor claims, US$5.7 billion of which will be compensated with new dollar bonds.
Sunac shares have surged on the debt deal and government support, rising almost 19 per cent in two trading sessions this week.
The loan for Sunac comes with a term of no more than three years, with the last being a grace period, according to the Hong Kong stock exchange filing. Huarong Capital Management is the executive partner for Shanghai Haolong, with China Huarong acting as the limited partner. BLOOMBERG
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