A major Chinese commodity trader looks poised to become the most high-profile state-owned enterprise to default in the dollar bond market in over two decades, Bloomberg News reported. In a fresh sign that Beijing is more willing to allow failures in the politically sensitive SOE sector, Tewoo Group has offered an unprecedented debt restructuring plan that entails deep losses for investors or a swap for new bonds with significantly lower returns. Tianjin-based Tewoo Group Co.

A troubled Chinese state-own firm is giving bondholders a stark choice on $1.25 billion of dollar bonds: take a haircut of as much as 64% or accept delayed repayment with sharply reduced coupons, a BloombergQuint reported. Tewoo Group Corp., which is owned by the Tianjin local government, proposed the exchange/tender offer on Friday on three dollar bonds due to mature over the next three years as well as a perpetual note. The news came after a bank paid a coupon on a $500 million bond last week which was backed by a standby letter of credit.

Chinese private equity group Hony Capital plans to tighten its grip on PizzaExpress with an agreement to buy an additional £80m of its bonds at a steep discount, giving it more control over any restructuring of the UK restaurant chain’s debts, the Financial Times reported. The move, which was opposed by some debt holders over concerns they could be marginalised, makes a restructuring more likely, analysts said. PizzaExpress, which was bought by Hony in a £900m leveraged buyout in 2014, revealed a debt pile of £1.1bn in its annual report in April.

A subsidiary of China’s largest construction group has suspended work on one of the nation’s tallest skyscrapers after the developer became the latest in a string of companies to default on a payment, the Financial Times reported. The default highlights the growing challenges faced by China’s construction groups as the slowing economy trims credit supply, putting the once runaway mega-tower building boom under stress.

In a related story, Bloomberg News reported that Chinese technology conglomerate Tunghsu Group Co. is looking to extend its bond payment deadlines after failing to settle its obligations this week, in the latest sign that the nation’s private-sector firms are struggling to ease their debt load amid an economic slowdown. Beijing-based Tunghsu Group mainly produces photoelectric display components, but also operates new energy, real estate and other businesses. Its three listed companies -- Tunghsu Optoelectronic Technology Co., Tunghsu Azure Renewable Energy Co.

An attempt by lenders to get PizzaExpress Ltd. to open talks on ways to prop up the troubled restaurant chain has failed to bring its Chinese owner to the negotiating table, Bloomberg News reported. The investors, holding 70% of PizzaExpress’s most senior bonds, sent a letter to the company a week ago pledging to provide new funds, according to people familiar with the matter.

A Chinese conglomerate’s rescue plan for Britain’s second-biggest steelmaker has been met by doubts from unions and industry insiders who question the buyer’s motives and business logic, the Financial Times reported. Jingye Group, a privately owned Chinese group whose interests span hotels, property, tourism and chemicals alongside steelmaking, agreed to buy British Steel from the UK’s Insolvency Service.

China’s local governments face a record number of lawsuits for failing to pay their contractors as the country’s slowing economy puts a strain on public finances, the Financial Times reported. The financial outlook has deteriorated so markedly that analysts have warned that there is a risk of social unrest. Chinese courts have listed 831 local governments as being in default in the first 10 months of this year, compared with 100 in the whole of 2018.

China Minsheng Investment Group Corp. once sought to be the nation’s version of JPMorgan Chase & Co. Instead it’s the country’s biggest dollar bond defaulter this year, Bloomberg News reported. With $2 billion of debt maturing in 2020, the company is scrambling to raise cash. It’s slashed executive pay as much as 83% and is selling assets. One of the largest private investment companies in China, the group was set up by 59 non-state companies in 2014 with a mandate to help Chinese private enterprise expand globally.

China’s local governments are helping inject fresh capital into small lenders across the country, part of an expanding campaign to restore confidence in the world’s largest banking system, Bloomberg News reported. At least 10 small Chinese banks have raised money this year by selling shares packaged with non-performing loans, in several cases to buyers controlled by local authorities. In at least one deal, the NPLs were sold at above-market rates.