Shimao gets second reprieve in liquidation, winning time until August 12 to work out its debt

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It was the second hearing since China Construction Bank (Asia) filed a liquidation petition in April in pursuit of its US$202.3 million debt

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Residential buildings under construction at the Honor of China project, originally developed by Shimao Group Holdings on December 16, 2022. Source: Bloomberg

Yulu Ao

Published: 11:32am, 31 Jul 2024Updated: 6:16pm, 31 Jul 2024

Shimao Group Holdings has received a second reprieve in a month to restructure its debt, after a Hong Kong court granted the Shanghai company more time to work out with creditors how to repay HK$1.58 billion (US$202.3 million) of borrowings.

The liquidation case brought by China Construction Bank (Asia) against Shimao will be heard on August 12, according to a July 31 ruling by Justice Jack Wong Kin-tong of the Hong Kong High Court. The hearing for the case, filed in April, was previously adjourned on June 26.

The extra time granted to Shimao came after the company amended the terms of its debt restructuring, including changes to the redemption and repayment schedules, according to a filing last Friday to the Hong Kong stock exchange.

Lawyers representing both petitioner and the company had sought a 10-week adjournment at the hearing, before Justice Wong made the decision.

Shimao’s lawyers said more time is needed for creditors to review the revised term sheet. A lawyer representing the petitioner said a 10-week adjournment will “save time and costs”.

The revisions are “beneficial” to its creditors, including bondholders and certain bank lenders, Shimao said in its filing, adding that a “significant portion” had acceded to the amended agreement.