Latest news with #NewWorldDevelopmentCo
The Star
11-07-2025
- Business
- The Star
Tycoons damaging Hong Kong's credit culture
The city's old money are dishing out one nasty surprise after another. — Bloomberg HOW creditworthy are Hong Kong's billionaire-tycoons? Despite the glamour and prestige they project, the city's old money are dishing out one nasty surprise after another. As bankers and investors wake up to the reality that they might never be made whole, the easy credit culture long afforded to the elite will inevitably come to an end. New World Development Co's decision not to repay coupons on its perpetual notes was a rude awakening but it was by no means an outlier. Emperor International Holdings Ltd, a fellow developer that sells luxury apartments, said it had HK$16.6bil (US$2.1bil) in bank borrowings that are either overdue or have breached loan covenants, which may result in immediate repayment requests. Emperor is a household brand in Hong Kong. The 82-year-old patriarch Albert Yeung started with a jewellery store in the late 1960s, selling Rolex and Omega watches. But over the years, the 'king of clocks and watches' expanded into media and real estate. Emperor Entertainment, in particular, is closely associated with local culture. It manages a roster of canto-pop singers and actors such as Nicholas Tse. Or consider Far East Consortium International Ltd, which went public more than half a century ago. The builder, known for projects at the city's iconic old Kai Tak airport, has pan-Asia ambition. It has joined forces with Chow Tai Fook – New World's parent – to develop a casino complex in Brisbane ahead of the 2032 Summer Olympics. Just like New World, Far East is sowing confusion among its US$360mil perpetual note holders. In its latest annual report released in late June, the company said it would no longer pay dividends. Investors are now worried that it would follow its business partner's footsteps by not repaying coupons. The builder's open market operations are equally alarming. In the fiscal year ending March, it bought US$4mil principal amount of perpetuals but resold at a loss. This is a sharp turn of events. Last September, Far East won a concession from its investors, buying time to redeem debt. The builder promised then that it would 'aim to initiate partial call' in the first quarter of 2025. Its own trading activities suggest it has not done so. Until recently, the city's old money had it easy. The name brand itself spelled investment grade. As of last June, nearly 70% of New World's bank loans were unsecured. In addition, local borrowers could issue bonds governed by English law. By comparison, dollar notes from mainland developers, such as China Evergrande Group, had to follow New York law. For issuers, this law might be more stringent in the event of consent solicitation, where a company asks to change the terms of its securities. But that leniency is running thin. Granted, New World managed to eke out an US$11.2bil loan refinancing deal – perhaps because when it owes banks so much money, it owns them. Others may not be so lucky. — Bloomberg Shuli Ren is a Bloomberg Opinion columnist covering Asian markets. The views expressed here are the writer's own.
Bloomberg
26-06-2025
- Business
- Bloomberg
New World Gets 100% Lender Approval for $11 Billion Refinancing
Distressed Hong Kong builder New World Development Co. has secured written commitments from all banks for a HK$87.5 billion ($11.1 billion) loan refinancing, people familiar with the matter said, bringing it closer to finalizing a critical lifeline just days before a deadline. The next procedural step to formally conclude the transaction is for lenders to sign the loan documents, according to the people. They expect that to happen shortly. Documentation showed that if New World didn't achieve a 100% approval by June 30, the deal could fall through as any collateral pledged would be released and bank commitments canceled.
Bloomberg
20-06-2025
- Business
- Bloomberg
New World's Bond Prices Surge as It Nears Refinancing Deal
New World Development Co. 's dollar bonds are poised to hit their highest levels this month as the company closes in on a crucial loan refinancing deal. The indebted Hong Kong builder's bonds were up 2 to 3 cents across maturities Friday morning, according to traders. A senior note maturing in 2027 rose nearly 3 cents to 71 cents on the dollar, on pace for its highest level since May 30, when the company said it would delay interest payments on four of its perpetual bonds.
Bloomberg
13-06-2025
- Business
- Bloomberg
New World's $11 Billion Refinancing Gambit Must Get 100% Support
As distressed Hong Kong builder New World Development Co. gathers more support from banks for its targeted HK$87.5 billion ($11.1 billion) loan refinancing, a key part of the terms shows that it must get 100% in commitments, or the deal will fall through. Documentation for the potential borrowing shows that if New World doesn't achieve a 100% approval rate by June 30, any collateral pledged would be released and bank commitments canceled, people familiar with the matter said.
Bloomberg
12-06-2025
- Business
- Bloomberg
New World Gains Support for 87% of Loan Refinancing From Banks
By Apple Ka Ying Li and Save New World Development Co. has received more backing from banks for its HK$87.5 billion ($11.2 billion) loan refinancing, giving it written commitments for 87% of the total, according to people familiar with the matter. That means it has secured HK$76.1 billion of commitments as it races to complete the deal with more than 50 banks by the end of the month, when a covenant waiver on its existing facilities expires. The latest tally marks continued progress for the distressed Hong Kong builder. As of May 30, New World had secured written commitments from over 20 banks for 60% of the total target, Bloomberg reported.
