The chairman of heavily indebted Chinese property group Evergrande has put up $1bn of his own money to buy his company’s bonds in a complex new deal, highlighting shaky demand for the country’s offshore debt.
China’s third-richest man, property developer Hui Ka Yan, bought more than half of the overall issue, according to an exchange filing, despite generous annual interest rates of up to 13.75 per cent, well above the 8.75 per cent on eight-year dollar debt the company issued last year.
Mr Hui has strong relationships with other mainland and Hong Kong tycoons, who have in the past lent to him even in tricky market conditions. Some stepped forward to take much of the remaining $800m and were, in the market’s parlance, “stuffed”, receiving much larger allocations of the debt than they could expect in a more typical deal.