Bondholders Slam Sino-Ocean’s Restructuring Plan as Debt Evasion
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Sino-Ocean suspended payments on all offshore borrowings in September 2023, amid a wave of default by Chinese builders affected by the country’s property crisis
A group of offshore bondholders of Sino-Ocean Group Holding Ltd. has strongly opposed a debt restructuring plan put forward by the distressed developer for more than $5.6 billion in dollar bonds, criticizing the company and its largest shareholder for alleged debt evasion.
The creditor group published a full-page advertisement in a Hong Kong newspaper challenging the debt restructuring plan unveiled by Sino-Ocean last month.
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- Offshore bondholders of Sino-Ocean Group opposed a $5.6 billion debt restructuring plan, accusing the company and its largest shareholder, China Life, of debt evasion.
- Sino-Ocean's plan includes issuing $2.2 billion in new bonds and restructuring various debts, but it faces criticism for deep haircuts and poor recovery rates for some creditors.
- Sino-Ocean needs 75% creditor support by August; meanwhile, it faces potential liquidation with a court hearing on September 11.
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Who’s Who
- Sino-Ocean Group Holding Ltd.
- Sino-Ocean Group Holding Ltd. is a Beijing-based distressed developer facing opposition from offshore bondholders over a $5.6 billion debt restructuring plan. Its largest shareholder is China Life Insurance Co. Ltd., holding 29.59%. The plan offers new bonds and securities as repayment but faces criticism for deep haircuts and low recovery rates. Sino-Ocean suspended offshore debt payments in September 2023 and faces a winding-up petition, with a court hearing on September 11.
- China Life Insurance Co. Ltd.
- China Life Insurance Co. Ltd., a state-owned insurance giant, is the largest shareholder of Sino-Ocean Group Holding Ltd., owning 29.59% of the company. It has been criticized by a group of offshore bondholders for allegedly failing to perform its duties as the largest shareholder and engaging in suspicious debt evasion activities with Sino-Ocean. The creditor group has demanded China Life disclose its holding of Sino-Ocean’s offshore debts and be removed from the restructuring vote.
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What Happened When
- September 2023：
- Sino-Ocean suspended payments on all offshore borrowings.
- July 2024：
- Sino-Ocean said it had support from a lender group representing about half of the company’s Class A debt.
- By August 2024：
- Sino-Ocean needs the support of 75% of each class of creditors to push the restructuring forward.
- July 18, 2024：
- Sino-Ocean unveiled the repayment plan for its offshore debt.
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