Xinyuan Real Estate begins exchange offer for 14.2% notes due 2021

Chicago, Sept. 30 – China’s Xinyuan Real Estate Co., Ltd. started an exchange offer and consent solicitation for its outstanding 14.2% senior notes due 2021 (ISIN: XS1943449022), according to a document.

Noteholders will be able to elect one of two exchange options in the offer.

One option is a cash payment of $60, inclusive of a $50 upfront fee and an incentive fee of $10, plus $950 million in new 14.2% senior notes due 2023 and accrued interest on the existing notes paid in cash and cash in lieu of any fractional amount of notes.

The second option has a cash payment of a $10 incentive fee plus $1,000 of new notes with accrued interest on the existing notes also paid in new notes and cash in lieu of any fractional amount of notes.

Tendering noteholders will also be deemed to have delivered consent to waivers and a release.

By tendering their notes for exchange, noteholders will waive any and all rights on the existing notes, waive any and all actual or potential defaults or events of default that have occurred or may be continuing on the exchange settlement date and release and discharge the company from any and all claims the holder may have on the existing notes.

A majority of noteholders must consent to the waivers and the release.

The company was downgraded by S&P Global Ratings to CCC from B- on Sept. 23. The downgrade was based on a lack of transparency because of delayed financial statements and questions about whether it could repay the $229 million of notes that are due in October.

The offer expires at 11 a.m. ET on Oct. 12.

Settlement for the new notes will be Oct. 15, with the cash consideration subject to a seven-day grace period.

D.F. King & Co., Inc is the information and tender agent for the offer (+44 20 7920 9700, +852 3953 7208, xinyuan@dfking.com, https://sites.dfkingltd.com/xinyuan).

Xinyuan is a Beijing-based real estate developer and property manager with properties primarily in China.

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