Caixin
Apr 16, 2020 04:00 AM
FINANCE

HNA Bondholders Challenge Vote Favoring Payment Extension

What’s New: Some bondholders of beleaguered HNA Group filed complaints with regulators accusing the company of manipulating a vote for a repayment extension that will help it avoid an immediate default on a 390 million yuan ($55.3 million) domestic bond.

Several HNA bondholders submitted accusations against HNA and its lead underwriter Essence Securities Co. Ltd. to the Shanghai Stock Exchange, the National Development and Reform Commission and the interbank market regulator. They questioned whether HNA used connected parties to engineer a vote Tuesday allowing the company to delay the bond repayment for one year.

Background: HNA caused an uproar among bondholders after calling a last-minute meeting Tuesday evening to vote for a payment extension just hours before the bond matured.

The company said Wednesday it secured enough support from bondholders to delay the payment for a year. Three investors holding 345 million yuan of bond principal, representing 98.3% of the valid votes at the creditor meeting Tuesday, agreed to the proposal, HNA said. But 29 small investors, who accounted for 6 million yuan of bonds, voted against the extension.

Several bondholders said they received notification of the meeting only half an hour before it started, violating procedures and indicating HNA’s intention to leave out investors who might oppose the plan.

Quick Takes are condensed versions of China-related stories for fast news you can use. To reach the full report in Chinese, click here

Related: Troubled HNA Group Dodges Debt Bullet After 11th-Hour Meeting


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