Yunfeng Defaults for 6th Time

Bloomberg in March: China's No. 3 Developer Makes Deals as Default Risks Escalate
China’s third-largest developer is sustaining its pace of deal making even as bond investors start to price in a higher risk of default.

The yield spread on Greenland Holdings Corp.’s $600 million 5.875 percent 2024 notes over U.S. Treasuries has widened 47 basis points this year to 404. There is a 6.89 percent probability it will miss debt payments in the next 12 months, according to the Bloomberg Default Risk model that tracks metrics including share performance, debt and cash flow. While the risk of default has declined from a late-January peak of 8 percent, it’s the highest among the nation’s biggest developers.

Greenland announced 2 billion yuan ($308 million) in Chinese acquisitions since December -- after buying properties in Los Angeles and Toronto in a global push since 2012 -- and on Friday said it will list hotel-focused real estate investment trusts in Singapore. China International Capital Corp. said the expansion had burdened Greenland with debt and that the company’s reputation could be damaged after a Caixin magazine report on March 1 that 20.5 percent-owned affiliate Shanghai Yunfeng Group Co. was in default.
Fitch in March: Reported Default by Yunfeng Will Not Affect Greenland's Ratings
Fitch Ratings says that the ratings of Chinese homebuilder Greenland Holding Group Company Limited (Greenland; BBB-/Negative) are not affected by the reported missed payments by its 20.5%-owned associate Yunfeng Group Limited (Yunfeng) on its onshore debt instruments. This is because Yunfeng's debt is non-recourse to Greenland. Furthermore, if Greenland decides to assist Yunfeng - or is directed by its shareholders to do so - such assistance will not be sufficient to hurt its credit profile, since Yunfeng's net debt represented only 5.5% of Greenland's debt at end-June 2015.

Media reported in late February 2016 that Yunfeng had missed the coupon payment on a privately placed onshore debt instrument in early 2016, and failed to redeem another similar debt when Yunfeng's leverage ratio breached debt covenants and bondholders exercised their put option for immediate repayment. Fitch has been unable to verify the details of Yunfeng's alleged default.

Yunfeng, which operates in the energy industry, ceased to be a subsidiary of Greenland - the second-largest homebuilder in China by contracted sales - on 1 October 2015. This was after Greenland ended the equity custody agreement with Shanghai Greenland Assets Holding Co. Ltd (Greenland Assets), a 34% shareholder of Yunfeng. Both Greenland and Greenland Assets are ultimately owned by the Shanghai municipality.

Greenland, in an announcement on 1 March 2016, said that Yunfeng has been operating independently and that it has not provided any debt guarantee to Yunfeng. Nonetheless, Greenland said that, as one of the shareholders, it would assist Yunfeng to "properly handle the related matters", provided that it is compliant with relevant laws and regulations.
Yunfeng recently defaulted for the sixth time.

Sina: 云峰债六次违约 投资人要求证监会全面彻查绿地上市
Sina Financial News July 27 message, according to financial reports, "15 Yunfeng PPN004" (Yunfeng private debt) is about to expire on July 30, the lead underwriter Guangdong Development Bank has verbally inform investors, the current private debt will continue to default. This is since January this year, Yunfeng PPN six consecutive breach of contract.

  July 26, "15 Yunfeng PPN001" Fifth holders meeting voted to adopt a "15 Yunfeng PPN001 holders meeting vote on the motion book." Vote book suggested that "in view of the existence of the Green Group Tao Feizhai behavior, there is a huge difference in the financial data and financial data disclosed in the listing documents with the Greenland Group Yunfeng Group disclosure requirements of China Securities Regulatory Commission to thoroughly investigate the Greenland Group listed Compliance , a thorough investigation of the existence of financial fraud "; and requested" green holding Group Co., Ltd. of Shanghai Yunfeng (Group) Co., Ltd. issued '15 Yunfeng PPN001 'unconditional and irrevocable joint and several responsibility to ensure security until maturity payment. "

  Investors believe Yunfeng private debt defaults are "Greenland Group, the largest shareholder did not return the money, malice the default, and questioned the use of the Green Group and Yunfeng Group table listing and financing, after the announcement that is listed on a piece of paper lifted Yunfeng stake hosting relationship with burden rejection suspect fraud IPO's. "

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