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Central China Real Estate Limited - Exchange and Consent Offer - Exchange and Consent Results

RESULTS OF (1) THE EXCHANGE OFFER AND CONSENT SOLICITATION IN RELATION TO THE FOLLOWING SECURITIES


19 APRIL 2023


Full announcement including disclosures and disclaimers, available via SGX


"RESULTS OF THE EXCHANGE OFFER AND CONSENT SOLICITATION


The Exchange Offer and Consent Solicitation expired at 4:00 p.m., London time, on April 18, 2023. The Company hereby informs Eligible Holders that, as of the Exchange Expiration Deadline, US$237,275,000 of the outstanding April 2019 Notes, US$173,165,000 of the outstanding November 2019 Notes and US$348,013,000 of the outstanding June 2020 Notes, respectively, has been validly tendered for exchange. The Company has decided to waive the Minimum Acceptance Amount in accordance with the terms of the Exchange Offer and Consent Solicitation and to accept all validly tendered Exchange Notes pursuant to the Exchange Offer and Consent Solicitation.


Subject to the fulfillment or waiver of the conditions to the Exchange Offer and Consent Solicitation, including, among others, receiving the approval from NDRC for extending the validity period of the Certificate, the Company will issue US$237,275,000 in principal amount of the April 2025 Notes, US$173,165,000 in principal amount of the November 2025 Notes and US$348,013,000 in principal amount of the August 2025 Notes pursuant to the Exchange Offer on the Settlement Date, being on or about April 28, 2023. The April 2025 Notes will bear interest at 7.25% per annum, payable in arrears and will mature on or about April 28, 2025, unless earlier redeemed pursuant to the terms thereof. The November 2025 Notes will bear interest at 7.9% per annum, payable in arrears and will mature on or about November 7, 2025, unless earlier redeemed pursuant to the terms thereof. The August 2025 Notes will bear interest at 7.65% per annum, payable in arrears and will mature on or about August 27, 2025, unless earlier redeemed pursuant to the terms thereof.


Subject to consummation of the Exchange Offer and Consent Solicitation, Eligible Holders of the Exchange Notes validly accepted and exchanged in the Exchange Offer and Consent Solicitation will receive the applicable Exchange and/or Consent Consideration on the Settlement Date. Should the conditions to the Exchange Offer and Consent Solicitation not be fulfilled or waived, the Company will not be able to consummate the Exchange Offer and

Consent Solicitation, and will need to consider alternative options. Participating Eligible Holders are reminded that notwithstanding the above, the Exchange Notes generally will be blocked from the date of instruction until the earlier of (i) consummation and (ii) termination of the Exchange Offer and Consent Solicitation and will not be able to sell or otherwise transfer their interests in any tendered Exchange Notes during such time.


In addition, as the requisite consents with respect to the November 2019 Notes and June 2020 Notes have been obtained, subject to the fulfillment or waiver of the conditions to the Exchange Offer and Consent Solicitation, the Company plans to execute the November 2019 Notes Supplemental Indenture and the June 2020 Notes Supplemental Indenture to give effect to the proposed waivers and amendments to the November 2019 Notes Indenture and the June

2020 Notes Indenture on the Settlement Date. From and after the execution of the November 2019 Notes Supplemental Indenture and the June 2020 Notes Supplemental Indenture and payment of the applicable Exchange and Consent Consideration to Eligible Holders who have validly tendered their November 2019 Notes and June 2020 Notes, each present and future holder of the November 2019 Notes and June 2020 Notes will be bound by the terms of the

November 2019 Notes Indenture and June 2020 Notes Indenture, respectively, as amended by the applicable November 2019 Notes Supplemental Indenture and June 2020 Notes Supplemental Indenture, respectively.


All documents and materials related to the Exchange Offer and Consent Solicitation will be made available, subject to eligibility, on the Exchange Website: https://projects.morrowsodali.com/ccreexchange.


RESULTS OF THE CONCURRENT CONSENT SOLICITATION


The Concurrent Consent Solicitation expired at 4:00 p.m., London time, on April 18, 2023.

The Company is pleased to announce that it has received the Requisite Consents necessary to effect the Proposed Amendment with respect to each and every series of the Consent Notes.


As the Requisite Consents have been received, subject to the fulfillment or waiver of the conditions to the Concurrent Consent Solicitation, the Company and the Subsidiary Guarantors intend to execute the Supplemental Indentures with respect to the Consent Notes Indentures with the relevant Consent Notes Trustees as soon as practicable to give effect to the


Proposed Amendment.


The Company currently expects any Consent Fee due will be paid on or about April 21, 2023, subject to the consummation of the Concurrent Consent Solicitation and satisfaction of the conditions for payment of the Consent Fee as set forth in Consent Solicitation Statement."

 

THE EXCHANGE OFFER AND CONSENT SOLICITATION AND THE CONCURRENT CONSENT SOLICITATION – RECEIPT OF THE REQUISITE CONSENTS IN RELATION TO THE FOLLOWING SECURITIES


18 APRIL 2023


Full announcement including disclosures and disclaimers, available via SGX


"Reference is made to the announcements of the Company dated April 3, 2023 and April 13, 2023 (the “Announcements”) in relation to the Exchange Offer and Consent Solicitation and the Concurrent Consent Solicitation. Capitalized terms used in this announcement shall have the same meaning ascribed to them in the Announcements.


The Company is pleased to announce that it has received the Requisite Consents necessary to effect the Proposed Amendment with respect to each and every series of the Consent Notes.


The Company believes that these consent instructions have indicated the continuing support from such holders of the Consent Notes to the Concurrent Consent Solicitation, which if consummated, would help the Company in managing its offshore financial obligations.


The Company encourages the Eligible Holders who have not validly tendered the Exchange Notes to tender their Exchange Notes prior to the Exchange Expiration Deadline.


The Company would like to express its sincere gratitude to holders who have tendered their Exchange Notes in the Exchange Offer and Consent Solicitation and/or delivered Consents in the Concurrent Consent Solicitation."

 

CLARIFICATION ON THE EXCHANGE OFFER AND/OR CONSENT SOLICITATION IN RELATION TO THE FOLLOWING SECURITIES


13 APRIL 2023


Full announcement including disclosures and disclaimers, available via SGX


"Reference is made to the announcement of the Company dated April 3, 2023 (the “Announcement”) and the Exchange Offer and Consent Solicitation Memorandum dated April 3, 2023 (the “Exchange Offer and Consent Solicitation Memorandum”) in relation to the Exchange Offer and Consent Solicitation. Capitalized terms used in this announcement shall have the same meaning ascribed to them in the Announcement and the Exchange Offer and Consent Solicitation Memorandum.


The Company would like to highlight that in its effort to ensure fair treatment of holders of the proposed New Notes, given the proposed New Notes to be issued under the Exchange Offer (subject to its consummation) will have later maturities than the January 2020 Notes, the August 2020 Notes, the November 2020 Notes and the January 2021 Notes, it has already included under the proposed terms of each series of New Notes a requirement for the Company (a) to conduct a publicly announced cash tender offer in respect of such New Notes, or (b) to redeem such New Notes on a pro rata basis, within 60 days after the occurrence of certain repayment events under the January 2020 Notes, the August 2020 Notes, the November 2020 Notes and the January 2021 Notes. Eligible Holders should refer to the provision “Mandatory Redemption Upon a Notes Repayment Event” under the sections headed “Description of the April 2025 Notes”, “Description of the August 2025 Notes” and “Description of the November 2025 Notes” in the Exchange Offer and Consent Solicitation Memorandum for further information.


The Company believes that the repayment terms under the proposed New Notes, including the provision “Mandatory Redemption on Specified Dates” relating to the scheduled early repayments of the New Notes, and the provision “Mandatory Redemption Upon a Notes Repayment Event” mentioned above, would provide equitable treatment and protection to Eligible Holders who participate in the Exchange Offer. The Company would encourage Eligible Holders who have not yet tendered their Exchange Notes to do so under the Exchange Offer as soon as possible."

 

EXCHANGE OFFER AND CONSENT SOLICITATION IN RELATION TO THE FOLLOWING SECURITIES


03 APRIL 2023


Full announcement including disclosures and disclaimers, available via SGX




...


"INTRODUCTION


On the date of this announcement, Central China Real Estate Limited, a company incorporated in the Cayman Islands with limited liability (the “Company”) commenced the offer (the “Exchange Offer”) to exchange in respect of (A) at least US$270,000,000, or 90%, of the aggregate outstanding principal amount of the April 2019 Notes (the “April 2019 Notes Minimum Acceptance Amount”), (B) at least US$177,570,000, or 90%, of the aggregate outstanding principal amount of the November 2019 Notes (the “November 2019 Notes Minimum Acceptance Amount”) and (C) at least US$360,000,000, or 90%, of the outstanding principal amount of the June 2020 Notes (the “June 2020 Notes Minimum Acceptance Amount” and, together with the April 2019 Notes Minimum Acceptance Amount and the November 2019 Notes Minimum Acceptance Amount, the “Minimum Acceptance Amount”) held by Eligible Holders for the Exchange and Consent Consideration (as defined below), and the solicitation of consents from Eligible Holders to approve certain proposed waivers and amendments to the indentures governing the November 2019 Notes and the June 2020 Notes upon the terms and subject to the conditions (the “Consent Solicitation” and, together with the Exchange Offer, the “Exchange Offer and Consent Solicitation”) set forth in the Exchange Offer and Consent Solicitation Memorandum. The purpose of the Exchange Offer and Consent Solicitation is to improve the Company’s overall financial condition, extend its debt maturity profile, strengthen its balance sheet and improve cash flow management.


The Company is also concurrently soliciting consents from the Holders of the Consent Notes to certain proposed amendments to each of the Consent Notes Indentures, upon the terms and subject to the conditions set forth in the Consent Solicitation Statement. The principal purpose of the Concurrent Consent Solicitation is to amend the events of default provision in the Consent Notes Indentures to carve out any default or event of default in respect of the Consent Notes as a result of a default or event of default occurring under the Exchange Notes, and to amend other related changes and make certain other updates, in accordance with the terms and subject to the conditions set forth in the Consent Solicitation Statement.


Unless otherwise defined, capitalized terms in this announcement will have the same meaning as those defined in the Exchange Offer and Consent Solicitation Memorandum and the Consent Solicitation Statement.


Consummation of the Exchange Offer and Consent Solicitation is subject to important conditions as further set forth below and in the Exchange Offer and Consent Solicitation Memorandum."


...


"BACKGROUND AND PURPOSE


During the second half of 2021, Chinese property developers and the capital markets that have funded growth and development of the sector have experienced an inflection point.


Reduced bank lending for real estate development has adversely affected access by property developers to onshore capital. Buyers’ concerns about the ability of property developers to deliver projects has adversely affected property sales. In addition, the use of pre-sale proceeds is also restricted under the applicable PRC policies. Driven by these negative onshore events and austerity policies, offshore capital markets have reacted negatively, which limited the Company’s funding sources to address upcoming maturities.


The property sector in China has continued to experience volatility in 2022. Further tightened bank lending, coupled with certain negative credit events, has intensified market concerns over the operations of Chinese property developers.


As a result, pre-sales of Chinese property developers have generally decreased. In light of the foregoing, the revenue and gross profit of the Company in 2022 have decreased as compared to the corresponding period in 2021. The Company’s cash and bank balances as of December 31, 2022 also decreased as compared to December 31, 2021. Against the backdrop of the adverse market conditions and recurrences of the COVID-19 outbreaks, the Company anticipates that the market condition in the real estate sector will remain under pressure in 2023.


On July 21, 2022, Henan Railway Construction & Investment Group Co., Ltd. (河南鐵路 建設投資集團) (“Henan Railway”), an enterprise wholly owned by the Henan Provincial People’s government, acquired the Company’s shares through its wholly-owned subsidiary, Henan Tongsheng Real Estate Co., Ltd. (河南同晟置業有限公司) (“Henan Tongsheng”) and became the second largest shareholder of the Company. In the future, the Company and Henan Railway intend to integrate their respective brands and competitive advantages in their respective industries to achieve synergistic integration, complementary advantages and winwin cooperation in multiple fields.


The Company is committed to mitigating the effects of the recent adverse market conditions and is striving to meet its financial commitments by prudently utilizing its existing financial resources. As part of these efforts, the Company is conducting the Exchange Offer and Consent Solicitation and the Concurrent Consent Solicitation. Given the April 2019 Notes will mature prior to the Settlement Date, the Company is also seeking a waiver for any potential Default or Event of Default under the November 2019 Notes and the June 2020 Notes which may occur as a result of non-payment of the April 2019 Notes under the Proposed Waivers.


The Concurrent Consent Solicitation is expected to settle before the April 2019 Notes mature. The Company believes the Exchange Offer and Consent Solicitation and the Concurrent Consent Solicitation will improve its overall financial condition, extend its debt maturity profile, strengthen its balance sheet and improve cash flow management, which would be in the interest of all its stakeholders, including the holders of the Exchange Notes and the Consent Notes.


If either the Exchange Offer and Consent Solicitation or the Concurrent Consent Solicitation are not successfully consummated, the Company will not be able to fully repay the Exchange Notes and/or Consent Notes, and its other efforts to meet its financial commitments may not achieve the desired effect. Even after consummation of the Exchange Offer and Consent Solicitation, the Company may not be able to make payments due on any outstanding Exchange Notes or any other outstanding indebtedness. As such, the Company may have to consider an alternative debt restructuring exercise."

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