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A large construction company went bankrupt ᐉ News from Fakti.bg – Real Estate

Sunac China Holdings Ltd., the fourth largest housing builder in China. went bankrupt. It has become one of the largest real estate companies in China, which gave up its obligations amid a record wave of missed payments.

In a bankruptcy petition sent to the Hong Kong Stock Exchange, the company said it had not paid bond coupons worth $ 29.5 million before the end of its grace period and had no plans to make payments on other securities.

The report says the recent coronavirus pandemic in China has affected home sales, worsening the company’s liquidity. According to the documentation, Sunac has appointed legal and financial advisers to help assess the company’s capital structure and liquidity.

China’s real estate sector has been battling a debt crisis since last year following a national crackdown on excessive leverage and a series of defaults. More than a dozen major construction companies have missed payments on offshore accounts, including the giant China Evergrande Group. High-yield dollar bonds from Chinese issuers, most of which come from real estate companies, continue to suffer losses.

Sunac ranks first among companies that have not paid government bonds this year. The development fuels fears of a new wave of default among real estate companies, which until a few months ago were considered reliable borrowers.

“We are concerned that this event may be a prelude to a new wave of default among weak private developers who are on the brink of survival,” said Leonard Lowe, senior credit analyst at Lucror Analytics.

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