Power Construction unit begins consent bid for 4½% notes due 2021

By Sarah Lizee

Olympia, Wash., Sept. 16 – Power Construction Corp. of China unit Powerchina Real Estate Group Ltd. launched a consent solicitation for holders of its $300 million of 4½% notes due 2021 (ISIN: XS1917764372), according to a notice.

The notes are guaranteed by Power Construction.

Power Construction is planning to reorganize and integrate the real estate business of the group, being Powerchina Real Estate and its subsidiaries, through consolidating the issuer into Langold as the listed platform for the real estate business of the group. After the reorganization and consolidation, Powerchina Real Estate will be consolidated into Langold and subsequently deregistered.

The issuer is required to convene relevant bondholders meetings according to the existing bonds issued, both onshore and offshore, including the notes due 2021, to seek consents in relation to the novation of the obligations and the assignment of the rights under relevant bonds terms to Langold, or take other actions in relation to the protection of bondholders' rights.

The reorganization and consolidation will only proceed if the issuer has obtained all necessary bondholders' consent or satisfied other actions in relation to the protection of bondholders' rights, such as redemption of bonds held by holders that have withheld their consents.

The company said that as of Sept. 16, all holders other than holders of the 2021 notes had given consents.

The issuer is offering to holders who vote in favor of the proposal by 11 a.m. ET on Sept. 30 a consent fee of 0.15%.

The fee is only payable if the required consents to pass the resolution are received by the deadline, 4 a.m. ET on Oct. 12.

A meeting for noteholders is set for 4 a.m. ET on Oct. 14.

Power Construction is a Beijing-based contracting, investment and real estate development company.

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