Shimao default triggered as petition leaves debts due
AM730 · 2 SOURCESabout 5 hours ago2 MIN
Summary
Shimao Group said default events have occurred under its affected debt instruments after a winding-up petition filed by Guotong Trust remained neither withdrawn nor stayed within 60 days of service on August 27. Following the expiry of that period on October 25, outstanding principal, any premium, and accrued but unpaid interest became automatically and immediately due and payable, with unpaid principal totaling about US$9.068 billion as of October 26.
Key Points
- Shimao Group (813) said the winding-up petition by Guotong Trust was served on August 27 and remained unresolved through the 60-day deadline ending October 25.
- The company said each affected debt instrument entered an event of default, making principal, any premium, and accrued unpaid interest immediately due automatically.
- As of October 26, the affected instruments carried about US$9.068 billion in outstanding principal, equivalent to roughly HK$71.1 billion
- Sing Tao reported the affected instruments include short-term and long-term loans, with outstanding principal of about US$771 million and US$1.269 billion respectively
- Shimao said Hong Kong Securities Clearing Company could suspend share-related services without notice, including acceptance of stock deposits into CCASS, potentially restricting transfers.
Why It Matters
For Hong Kong investors, the immediate issue is not only the accelerated debt burden but also possible disruption to settlement and transfer of Shimao shares if clearing services are suspended. The company said it will strongly oppose the winding-up petition and is seeking legal and financial advice, but it also warned the default could materially and adversely affect its financial position.