Wanda seeks to extend US$400 million bond amid liquidity strains
A UNIT of Dalian Wanda Commercial Management Group is proposing new terms for its US dollar bonds due 2025 to extend the maturity, reflecting the Chinese company’s liquidity challenges amid the country’s property downturn.
Wanda Properties Global is inviting eligible holders of its US$400 million, 11 per cent guaranteed bonds to approve some amendments, including extending the maturity to Jan 12, 2026 from Jan 20, 2025, according to a filing with Singapore Exchange dated on Monday (Nov 25). The company is also seeking to add a mandatory redemption on Jan 20 of 25 per cent of the aggregate principal amount of bonds then outstanding.
Bondholders’ approval will allow the company to alleviate its near-term liquidity pressure, and “proactively manage” its debt repayment schedule with expected cash flows, the company said in the filing. Wanda Properties has scheduled a bondholder meeting on Dec 17.
Even though its core business is commercial property management, rather than residential property development, the company still faces challenges in raising new financing or refinancing its existing debt, it said. “These events have in turn adversely affected the group, in particular its cash flows,” it said.
If the terms are not approved, the company and the bonds’ guarantors may not be able to repay the bonds at the original maturity date, and “cross-default provisions” may be triggered, it said.
Wanda’s 11 per cent 2025 US dollar bond was traded at 86.8 US cents on the US dollar as at Monday morning, down from 91.3 US cents a month ago.
Last year, Wanda Properties proposed a repayment schedule on a US$600 million dollar bond, offering to pay 10 per cent of the principal in January 2024, 20 per cent in May, 30 per cent in September and 40 per cent in December. The company has so far met its payment obligations on the bond, according to filings and Bloomberg reports. BLOOMBERG
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