Chinese promoter Sinic Holdings said on Monday that it will likely default on the US $ 250 million bond payment, as it does not have enough resources to meet the due date on schedule.
The case highlights the impact of China Evergrande Group, which is struggling with $ 305 billion of debt, in the rest of the high-yield sector as liquidity evaporates and sales slow.
Sinic said in September that a creditor had demanded repayment of accrued principal and interest totaling $ 75.4 million, due to late payments on local financing, and that the creditor had appointed receivers for some units.
The creditor’s execution triggered conditions under which other financing agreements and bonds worth $ 710 million can be immediately payable if the creditors decide to execute them, the company said.
Sinic said it was in discussions with lenders and other stakeholders about the repayment agreements. The payment and the last interest payment on the first batch of bonds worth $ 250 million is due on October 18.
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