Hong Kong’s Jiayuan extends exchange offer one more month to March 6

By Mary-Katherine Stinson

Lexington, Ky., Feb. 7 – Jiayuan International Group Ltd. extended its exchange offer a 10th time for six series of notes, according to an announcement on Tuesday.

The expiration deadline has again been pushed back one month and is now 11 a.m. ET on March 6. Previous extensions had set the deadline to Feb. 6, Jan. 5, Dec. 5, Nov. 28, Oct. 26, Oct. 19 and Oct. 5. The original deadline was Sept. 7.

The instruction fee deadline was likewise pushed out to 11 a.m. ET on March 7. Previous extensions had set the deadline to Feb. 7, Jan. 6, Dec. 6, Nov. 29 and Oct. 27. Originally, it was 11 a.m. ET on Oct. 6.

Consequently, settlement is now expected to occur on March 10. Listing for the new notes on the Singapore Exchange is now expected on or about March 13. Settlement was originally expected on Sept. 14.

Noteholders who have validly tendered their existing notes and submitted the restructuring support agreement or an accession to the RSA do not need to take any action.

Instructions regarding the exchange offer received after the eighth deadline remain irrevocable. The revocation deadline was 11 a.m. ET on Jan. 10.

Amendment to RSA

As previously reported, on Jan. 6, the company also entered into a second amendment deed to the restructuring support agreement to amend schedule 4 (term sheet) of the agreement and to extend the longstop date under the restructuring support agreement.

Noteholders who have not yet tendered their notes must validly execute an RSA in order to participate in the offer.

Offer details

On Sept. 14 the company improved the terms of the offer for noteholders.

The exchange and consent consideration (or simply exchange consideration in the case of the July 2023 notes) consists of $1,000 principal amount of new notes, a deferred interest consideration and an incentive fee.

The improvement to terms of the offer modified the payment schedule, moving the payment date of the deferred interest consideration earlier than previously provided.

Jiayuan had also entered into an amendment deed to the RSA to make substantial improvements to the terms of the proposed restructuring.

Exchange notes

The company is offering to exchange at least

• $89,325,000, or 90%, of the outstanding principal amount of its 11 3/8% senior notes due October 2022 (ISIN: XS2475749300) for new 6½% senior notes due Jan. 29, 2025;

• $180 million, or 90%, of the outstanding principal amount of its 12% senior notes due October 2022 (ISIN: XS2247215283) for new 6½% senior notes due Jan. 30, 2025;

• $158,143,500, or 90%, of the outstanding principal amount of its 13¾% senior notes due February 2023 (ISIN: XS2066357034) for new 6½% senior notes due May 18, 2025;

• $270 million, or 90%, of the outstanding principal amount of its 12½% senior notes due April 2023 (ISIN: XS2233091359) for new 6½% senior notes due July 8, 2025;

• $270 million, or 90%, of the outstanding principal amount of its 12½% senior notes due July 2023 (ISIN: XS2279822683) for new 6½% senior notes due Oct. 21, 2025; and

• $207 million, or 90%, of the outstanding principal amount of its 11% senior notes due February 2024 (ISIN: XS2333154867) for new 6½% senior notes due May 17, 2026.

The company is also soliciting consents to amend five of those series, namely all but the July 2023 notes. The company is seeking approval of some proposed waivers and amendments to each of the indentures governing those notes.

Background and purpose

The company explained that it is conducting the exchange offer and consent solicitation for all of its existing dollar-denominated senior notes due to adverse market conditions for real estate developers in China.

As a result, the company is seeking to do the following:

• Exchange the existing notes for new notes that are designed to extend the company’s debt maturity profile and ease its liquidity pressure;

• Waive any defaults and potential consequential events of default under the consent notes arising directly or indirectly from non-payment events in relation to interest payment and judgment for payment of money; and

• Amend the terms of the consent notes to substantially eliminate or amend the restrictive covenants and other provisions in those indentures to provide greater flexibility for the company’s continued efforts to strengthen its balance sheet and cash flow management.

The company said it believes that the exchange offer and consent solicitation, if successfully completed, could significantly improve its financial position, extend its debt maturity, improve its cash flow, better complete its project delivery tasks and enhance its debt performance capability.

To facilitate the implementation of a restructuring of the existing notes, the company may, in addition to the exchange offer and consent solicitation, consider launching a scheme of arrangement in Hong Kong (or a scheme of arrangement in any other relevant jurisdiction at the discretion of the company) to effect a restructuring of the existing notes on terms similar to the exchange offer and consent solicitation but open to all holders of the notes, including U.S. persons under Regulation S.

If the consent solicitation is not completed and a scheme is launched and consummated, there will be an instruction fee of 0.25% on existing notes tendered in the exchange offer and consent solicitation and restricted in the RSA. The instruction fee will be paid on the restructuring effective date.

The company has appointed Guotai Junan Capital Ltd. as its financial adviser and Sidley Austin as its legal adviser.

Morrow Sodali Ltd. (+44 20 4513 6933 or +852 2319 4130; jiayuan@investor.morrowsodali.com; https://projects.morrowsodali.com/jiayuan) is the information, exchange and tabulation agent with respect to the exchange offer and consent solicitation.

The property developer is based in Hong Kong.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.