Real estate developer Evergrande (HK:3333) witnessed a 1.4% drop in shares to HK$19.72 on Tuesday morning, after it issued an additional US$1 billion 11% notes due 2020 in the previous session.
Evergrande’s subsidiary Hengda Real Estate acts as the keepwell provider, investment holding company Tianji Holding as the parent guarantor and Citicorp International Limited as the trustee of the notes. These notes will mature on Nov. 6 2020.
The Guangzhou-based company said the funds raised from the notes will be used to “refinance existing offshore indebtedness.”
This is not the first time the group made an effort to shake off its debts. In late October, it issued $1.8 billion bonds – $565 million 11% bonds due 2020, $645 million 13% bonds due 2022 and $590 million 13.75% bonds due 2023. The group’s founder, Hui Ka Yan, and his company Xin Xin (BVI) Ltd, acquired $1 billion of its 2022 and 2023 bonds in total.
Bloomberg reported that the company’s proceeds from the issuance will be used to refinance its $2.4 billion offshore loans maturing in the first half of 2019.
