BEIJING: Chinese developer Shimao Group has missed the interest and principal payment of a $1 billion offshore bond due on Sunday in the latest blow to China’s embattled property market.
Shimao was unable to pay a total of $1.023 billion in principal and interest to creditors of a senior note listed on the Singapore Exchange, the developer said in a Sunday filing on the Hong Kong bourse, citing “market uncertainties over debt refinancing” and “challenging operating and funding conditions.”
With a coupon rate of 4.75 percent, the bond matured on July 3 this year.
The developer has not received notice of acceleration of repayment from its lenders, it said, suggesting the debt holders have not moved to take enforcement actions.
Shimao hired Admiralty Harbor Capital as its financial adviser and Sidley Austin its legal adviser to help assess and explore ways to manage the liquidity crisis.
Meanwhile, creditors of its two syndicated loans have agreed to give the cash-strapped Chinese developer a breather.
Shimao said it has received written notice of support from the majority of the lenders of two syndicated loans agreed upon in 2018 and 2019, in which HSBC acted as the lead facilitator for dual currency loans.
Tesla Q2 deliveries fall on China’s COVID-related shutdown
Tesla Inc. delivered 17.9 percent fewer electric vehicles in the second quarter from the previous quarter, as China’s COVID 19-related shutdown disrupted its production and supply chain.
The world’s biggest electric car maker said on Saturday that it delivered 254,695 vehicles in the April to June period, compared with 310,048 vehicles in the preceding quarter, ending a nearly two-year-long run of record quarterly deliveries.
A resurgence in COVID-19 cases in China had forced Tesla to temporarily suspend production at its Shanghai factory and also affected suppliers’ facilities in the country.
Tesla is ramping up production at the Shanghai factory with the easing of the COVID-19 lockdown, which will help boost deliveries in the second half.
Early in June, Tesla CEO Elon Musk told executives that he had a “super bad feeling” about the economy and needed to cut about 10 percent of staff at the electric car maker.
China loosening entry restrictions for US citizens
China will loosen entry restrictions on US citizens, allowing entrance in case of transit via a third country, notices issued late on Friday by the Chinese Embassy in Washington said, relaxing rules imposed in Beijing’s drive to curb COVID-19.
According to an updated policy statement, US citizens with valid negative COVID test results looking to enter China may now apply for and receive a green health code for travel in from either the US or a third country. In the past, the embassy would only grant the codes to US citizens flying directly from the US.
China has loosened the same restrictions recently for citizens of other countries.
The restrictions, coupled with a limited number of direct flights from the US to China, caused ticket prices to cost as much as $10,000.
The changes follow a similar slight relaxation of COVID-19 testing rules for people arriving in China from countries including the US announced on May 18.
(With input from Reuters)