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COUNTRY GARDEN's Proposed Restructuring May Involve Issuance of Mandatory Convertible Bonds/ New Shrs/ SCA Warrants
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Regarding its proposed offshore debt restructuring scheme that aims to reduce debt by over USD11 billion, COUNTRY GARDEN (02007.HK) announced that it had obtained sufficient support from the Class 1 creditors and Class 2 creditors to approve the scheme at the scheme meetings, which were convened on 5 November 2025. COUNTRY GARDEN also stated that it has been working closely with the ad hoc group of bondholders (AHG) and the co-ordination committee of bank creditors (CoCom) in order to implement the proposed restructuring by the end of 2025. The proposed restructuring transactions may involve issuing (i) mandatory convertible bonds (A) with a maximum principal amount of USD7.515 billion, of which up to USD7.5 billion will be paid as scheme consideration, up to USD11.2936 million will be paid as RSA fees, and up to USD 2.7764 million will be paid as work fees under the work fee arrangements entered into with the AHG; (ii) mandatory convertible bonds (B) with a maximum principal amount of USD5.443 billion as payment of scheme consideration; and (iii) mandatory convertible bonds (C) with a maximum principal amount of USD39.4614 million as part of the CHB bilateral loan resolution. The initial conversion prices per share for mandatory convertible bonds (A), (B), and (C) are HKD2.6, HKD10, and HKD1.1, respectively. COUNTRY GARDEN will issue SCA warrants to the Class 1 creditors which choose to receive SCA warrants, conferring rights to subscribe for SCA warrant shares. The initial SCA warrant exercise price is set at HKD0.6. In addition, the company proposes to issue up to 914 million new shares for payment of certain work fees owed to each of the AHG, CoCom, and CB holder group under their respective work fee arrangements. If it is unable to obtain all requisite regulatory approvals to issue mandatory convertible bonds (A) for the purposes of paying the RSA fees and the work fees payable to the AHG, it intends to issue up to an additional 42.21 million new shares at an initial conversion price of HKD2.6 per share. Moreover, COUNTRY GARDEN plans to issue up to 16.8498 million new shares at a price of HKD2.6 per share for payment of accrued and unpaid interest under the TFB bilateral loan up to and including September 30, 2024, amounting to HKD43.8096 million. AAStocks Financial News |
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