Hongyang Real Estate (01996) issued an announcement regarding its controlling shareholder Hongyang Group Co., Ltd. (Hongyang) under the High Law...
According to the Zhitong Finance App, Hongyang Real Estate (01996) issued an announcement regarding the petition for liquidation of its controlling shareholder Hongyang Group Co., Ltd. (Hongyang) in the High Court (Hongyang Petition) relating to the US$275 million senior notes (senior notes) issued by Hongsheng Co., Ltd. (Hongyang's direct wholly-owned subsidiary) and guaranteed by Hongyang due in 2022.
The company was advised by Hongyang that due to significant progress in the senior notes restructuring, the hearing of Hongyang's petition will be adjourned until July 15, 2024.
The company was informed by Hongyang that after discussions between Hongsheng Limited, its advisors and several senior note holders (creditor group), Hongsheng Co., Ltd. has entered into a restructuring support agreement (2024 restructuring support agreement) with (among others) creditor groups to support the implementation of the senior notes restructuring plan (2024 Hongsheng Reorganization Plan).
The 2024 Hongsheng restructuring plan is expected to be implemented mainly through the proposed arrangement plan to be implemented in the British Virgin Islands and in accordance with the terms of the 2024 restructuring support agreement, and through parallel arrangement plans in other relevant jurisdictions and/or approval procedures in other applicable jurisdictions to obtain cross-border acceptance and relief.
An arrangement plan is a statutory mechanism that allows the relevant court to approve a “compromise or arrangement” that has been voted on by the relevant class of creditors and the majority required; it is not an insolvency proceeding.
As of May 10, 2024, holders accounting for about 93.8% of the total outstanding principal amount of senior notes have signed or joined the 2024 restructuring support agreement and promised to support the 2024 restructuring plan.
The company was advised by Hongyang that it will continue to cooperate with all parties concerned to implement the terms of the 2024 Hongsheng restructuring plan.