Sunac China, once one of the country’s best-performing developers, failed to make an overdue interest payment on a U.S. dollar bond, marking a comedown for founder Sun Hongbin, who had tried for months to prevent his property giant from spiraling into default, the Wall Street Journal reported. Tianjin-based Sunac on Thursday said it couldn’t cobble together enough money to make a $29.5 million bond-coupon payment by the end of a 30-day grace period. The nonpayment could trigger cross-defaults on Sunac’s international bonds with a total face value of $7.7 billion, according to the note’s prospectus. The company’s international-bond default would further dampen investors’ confidence in the property sector. Before this month, 17 Chinese developers with a total of $51.4 billion in hard-currency debt had defaulted since the start of 2021, according to a Goldman Sachs research report. Sunac’s fall was surprisingly swift. The 18-year-old developer had raised money from a dollar bond sale as recently as last July, a time when bond investors and global credit raters were confident about its ability to avoid the financial troubles of debt-laden peers including China Evergrande Group and Kaisa Group Holdings Ltd. The two industry giants defaulted on their international debt in December after months of liquidity problems. Read more. (Subscription required.)
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