By P.R. Venkat
Property developer Sunac China Holdings Ltd. is raising 7.42 billion Hong Kong dollars ($952 million) to partly repay its debt.
The company will raise a total of HK$5.09 billion by issuing 335 million shares for HK$15.18 each and another HK$2.33 billion by selling a 5.1% stake in its unit Sunac Services Holdings Ltd., the company said late Sunday.
Many of China's property developers are facing severe liquidity issues as regulatory curbs on borrowing, coupled with slowing home sales, have heaped pressure on companies including conglomerate Evergrande Group.
Last week, Fantasia Holdings Group Co.said that some lenders were asking for loans to be repaid early, which dragged its stock to an over decade lows.
Sunac also said that its controlling shareholder Sun Hongbin has agreed to provide $450 million to the group in the form of interest-free loans to support the business.
Investment bank Jefferies said the fund raising will help Sunac "get over its short-term tight liquidity that is driven by weak sales/refinancing difficulty."
Write to P.R. Venkat at email@example.com
(END) Dow Jones Newswires