China Evergrande shares hit new low amid debt crisis; Kaisa misses pay date

China Evergrande shares hit new low amid debt crisis; Kaisa misses pay date
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Updated 08 December 2021

China Evergrande shares hit new low amid debt crisis; Kaisa misses pay date

China Evergrande shares hit new low amid debt crisis; Kaisa misses pay date
  • Even in the case of a technical default, Kaisa and offshore bondholders would continue the discussions

China Evergrande Group’s shares hit a record low on Wednesday after a missed debt payment deadline put the developer at risk of becoming the country’s biggest defaulter, even as hopes of a managed debt restructuring calmed fears of a messy collapse.


So far, any Evergrande fallout has been broadly contained, and with policymakers becoming more vocal and markets more familiar with the issue, consequences of its troubles are less likely to be widely felt, market watchers have said.


Failure by Evergrande to make $82.5 million in interest payments due Nov. 6 on some US dollar bonds would trigger cross-default on its roughly $19 billion of international bonds, with possible ramifications on China’s economy and beyond.


While the 30-day grace period is over, Evergrande has not announced if the bonds have formally defaulted.


The developer did not immediately respond to a Reuters request for comment.


“Without the official announcement, the market will want to wait and see and not give up yet; otherwise Evergrande’s share and bond prices should have tumbled a lot more,” said Steven Leung, director of UOB Kay Hian in Hong Kong.


“The market also wants to wait and see what can be done with local government stepping in now,” Leung added, referring to the move by Evergrande’s home province to help contain the risk.


Evergrande was once China’s top property developer, with more than 1,300 real estate projects.

With $300 billion of liabilities, it is now at the heart of a property crisis in China this year that has crushed almost a dozen smaller firms.


Trading in shares of embattled smaller peer Kaisa Group Holdings was suspended on Wednesday, after a source with direct knowledge of the matter said it was unlikely to meet its $400 million offshore debt deadline on Tuesday.


Kaisa, China’s largest holder of offshore debt among developers after Evergrande, had not repaid the 6.5 percent bond by the end of Asia business hours, the person said, which could push the notes into technical default, triggering cross defaults on its offshore bonds totalling nearly $12 billion.


Kaisa declined to comment.


Bondholders owning over 50 percent of the notes in question sent the company draft terms of forbearance late on Monday, a source previously told Reuters.


Even in the case of a technical default, Kaisa and offshore bondholders would continue the discussions, two sources with knowledge of the matter said.

Evergrande’s shares, which have given up more than 20 percent this month, were down 6 percent in the afternoon at HK$1.72 — lowest since their November 2009 debut. The broader market was steady.


Its notes due last month, one of two tranches with a coupon payment deadline that passed on Monday, traded at 18.613 cents on the dollar, Duration Finance data showed, versus 18.875 from the close of Tuesday Asia hours.


Kaisa’s bond due April 2022 traded at 36.397, little changed from the day earlier but down from 37.89 last week.


The government has repeatedly said Evergrande’s problems can be contained and moves to boost liquidity in the banking sector along with the firm’s plans to forge ahead with a restructuring of its overseas debt have helped reassure global investors.


The provincial government of Guandong, where Evergrande is based, stepped in last week to help manage the fallout, reinforcing the view that its failure would be managed.


Saudi SABIC, ExxonMobil begin operations of petrochemical JV on US Gulf Coast

Saudi SABIC, ExxonMobil begin operations of petrochemical JV on US Gulf Coast
Updated 20 January 2022

Saudi SABIC, ExxonMobil begin operations of petrochemical JV on US Gulf Coast

Saudi SABIC, ExxonMobil begin operations of petrochemical JV on US Gulf Coast

RIYADH: Riyadh-based Saudi Basic Industries, also known as SABIC, one of the leading petrochemical firms worldwide, announced the start of operations of its petrochemical joint venture with US ExxonMobil.

US Texas is to witness the launch of an ethylene production unit – operating an annual capacity of around 1.8 million tons, the homegrown petrochemical company said in a statement.

The new production unit, which started construction in 2019, will produce materials to be utilized in packaging, agricultural film, construction materials, clothing, and automotive coolants.

This project is in line with SABIC’s strategy, aimed at diversifying its feedstock as well as strengthening its position in North America.

“This is a remarkable achievement that positions us well to help meet growing global demand for performance products while providing meaningful investment in the US Gulf Coast,’ president of ExxonMobil Karen McKee said, commenting on the partnership.

SABIC noted that the deal’s financial impact is expected to roll out on the company’s financial statements during the ongoing quarter.

In the latest trading session, shares of the company edged down by 0.2 percent to close at SR126 ($33.6).


Mastercard, Coinbase partner to make NFTs more accessible

Mastercard, Coinbase partner to make NFTs more accessible
Updated 20 January 2022

Mastercard, Coinbase partner to make NFTs more accessible

Mastercard, Coinbase partner to make NFTs more accessible

RIYADH: Payments giant Mastercard has partnered with cryptocurrency exchange Coinbase to make non-fungible tokens more accessible.

Mastercards can be used to make purchases on Coinbase’s upcoming NFT marketplace.

“We’re excited to announce today that we’re partnering with Coinbase to let people use their Mastercard cards to make purchases on Coinbase’s upcoming NFT marketplace,” Mastercard said in a statement.

“Getting more people involved safely and securely is perhaps the best way to help the NFT market thrive.”

Mastercard also sees greater potential for core NFT technology to go beyond art and collectibles in many other areas.

Coinbase announced in October last year that it is launching an NFT marketplace.

“Coinbase NFT, as a peer-to-peer marketplace that will make minting, purchasing, showcasing and discovering NFTs easier than ever,” Coinbase said.

“We’re making NFTs more accessible by building user-friendly interfaces that put the complexity behind the scenes. We’re adding social features that open new avenues for conversation and discovery. And we’re going to grow the creator community exponentially, a win for artists and for fans.” 


Saudi Wafrah appoints Khaled Saleh Al Amoudi as CEO

Saudi Wafrah appoints Khaled Saleh Al Amoudi as CEO
Updated 20 January 2022

Saudi Wafrah appoints Khaled Saleh Al Amoudi as CEO

Saudi Wafrah appoints Khaled Saleh Al Amoudi as CEO

RIYADH: Saudi food firm Wafrah for Industry and Developments has appointed Khaled Saleh Al Amoudi as CEO on Thursday, according to a bourse statement. 

The decision follows recommendation from the Remuneration and Nomination Committee.

With a M.Sc.in Financial Management, Al Amoudi currently holds the chief financial officer position at the firm, with more than 20 years of accumulated experience as CFO and in the governmental and bank sectors.


Tadawul approves $755m government debt listing

Tadawul approves $755m government debt listing
Updated 20 January 2022

Tadawul approves $755m government debt listing

Tadawul approves $755m government debt listing

RIYADH: Saudi stock exchange Tadawul approved listing of SR2.83 billion ($755 million) worth of government debt instruments, submitted by the Ministry of Finance, according to a bourse filing.

The first issuance dated January 8, amounts to SR1.25 billion, Tadawul said in a statement.

The second issuance dated January 12, is valued at SR1.59 billion.


Profits of Saudi-based SADAFCO drop 28.6% as pandemic hits sales

Profits of Saudi-based SADAFCO drop 28.6% as pandemic hits sales
Updated 20 January 2022

Profits of Saudi-based SADAFCO drop 28.6% as pandemic hits sales

Profits of Saudi-based SADAFCO drop 28.6% as pandemic hits sales

RIYADH: Saudia Dairy and Foodstuff Co., or SADAFCO, reported a 28.6 percent decline in profit during the nine months ending Dec. 31, 2021. 

Profits dropped to SR146 million ($38.9million), compared to SR205 million in the corresponding period a year earlier, the company announced in a bourse statement.

SADAFCO attributed the lower profit figures to lower sales volumes driven by the pandemic, an increase from 5 percent to 15 percent in VAT, and higher material and logistics costs.

The financial statements of the company indicated a healthy cash flow, with a strong cash position of SR679 million.

SADACFO’s share price edged down by 0.12 percent in today’s session to close at SR167.

Earlier, the company’s board recommended cash dividends at SR3 per share for the first half of the fiscal year ended Mar. 31, 2022.

Jeddah-based SADAFCO operates sales and distribution depots in 24 locations across Saudi Arabia, Bahrain, Qatar, Jordan, and Kuwait. Its products are also exported to several countries in the MENA region.