Sunac China aims to raise $155 million to tackle debt issues

Sunac China a major property developer‚ has announced its intention to gather HK$1.21 billion (roughly $155 million) to tackle its existing corporate debt. This move comes at a time when Chinas property market is experiencing a significant downturn

The company plans to place about 489 million shares which represents 560% of its current share capital at HK$2465 each. Sunac intends to use the money from this subscription mainly to support long-term solutions for its onshore corporate bonds (the payments for these have been pushed to the end of 2024)

The placing and the subscription will help the group to better reach solutions on its onshore public debentures

In August this year Sunac reported a half-year loss of 1496 billion yuan (around $2.10 billion). This loss was primarily caused by the housing market downturn and other unspecified factors

Chinas property sector which is a key part of the countrys economy has been struggling since 2021. This rough patch began when a regulatory drive aimed at developers using too much leverage caused a liquidity crisis

The companys efforts to raise funds highlight the ongoing challenges faced by Chinese property developers in the current market conditions. As Sunac works to address its debt issues‚ the broader implications for Chinas real estate sector and economy remain a topic of interest for investors and analysts alike