Hong Kong’s Powerlong gets needed consents to amend four notes

By Marisa Wong

Los Angeles, July 13 – Powerlong Real Estate Holdings Ltd. issued an update on its exchange offer for two notes and consent solicitations for four notes that began on July 4.

The company has received the necessary consents under the consent solicitation, according to an announcement early Wednesday (Hong Kong time).

The company was urging holders who had not yet tendered their notes under the exchange offer and remaining holders who had not delivered their consents to do so as soon as possible before the expiration deadline at 11 a.m. ET on July 13.

Consent solicitations

The company is soliciting consents for the following notes:

• $419.6 million outstanding 6.95% senior notes due 2023 (ISIN: XS2030333384) (the outstanding principal amount not including $400,000 of notes held by the company’s affiliates);

• $500 million outstanding 6¼% senior notes due 2024 (ISIN: XS2213954766);

• $535 million outstanding 5.95% senior notes due 2025 (ISIN: XS2250030090); and

• $200 million outstanding 4.9% senior notes due 2026 (ISIN: XS2341882913).

The purpose of the consent solicitations is to amend the events of default provision in the indentures to carve out any default or event of default in respect of each series of notes as a result of a default or event of default in respect of the exchange notes.

Noteholders who consent are being offered a consent fee of $2.50 per $1,000 note.

The consent fee and the consent solicitations are conditioned on the receipt of the required consents for each series of notes, execution of each of the consent supplemental indentures, any laws that would prohibit implementation of the proposed amendment or the payment of the consent fee and no adverse changes to the group.

Exchange offer

Powerlong is offering to exchange its $200 million outstanding 4% senior notes due July 2022 (ISIN: XS2368100033). For each $1,000 note, the company is offering $950 of new July 2023 notes, $10 in cash as an incentive fee and $50 principal repayment in cash and accrued interest.

The July 2023 notes will have a 364-day tenor and the same 4% interest rate.

For the second series, Powerlong is offering to exchange the $300 million outstanding 7 1/8% senior notes due November 2022 (ISIN: XS2078556342) for a like amount of new January 2024 notes plus a $10 cash incentive fee and accrued interest.

The new January 2024 notes will have an 18-month tenor and the same 7 1/8% interest rate.

For both notes there is a minimum exchange condition.

For the July 2022 notes, $180 million of the notes must be exchanged, and for the November 2022 notes at least $270 million of the notes need to be exchanged.

A partial cash redemption for the new January 2024 notes of $50 for each $1,000 principal amount will be made by Oct. 18.

The purpose of the exchange offer is to extend the company’s debt maturity profile, strengthen its balance sheet and improve cash flow management.

The new notes will be listed on the Singapore Exchange Securities Trading Ltd.

Details

The exchange offer and the consent solicitations are not inter-conditional.

Each consent solicitation is an independent solicitation.

Exchange offer instructions are irrevocable.

The consent fee is expected to be paid on July 15.

Haitong International Securities Co. Ltd. is the solicitation agent and the dealer manager (fax: +852 2840 1680).

Morrow Sodali Ltd. is the information, exchange and tabulation agent (+44 20 4513 6933, +852 2319 4130, powerlong@investor.morrowsodali.com, https://projects.morrowsodali.com/powerlongconsent, https://projects.morrowsodali.com/powerlongexchange).

The real estate company is based in Hong Kong.

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