Country Garden Issues More Shares to Settle Restructuring Work Fees

The latest announcement is out from Country Garden Holdings ( (HK:2007) ).

Country Garden has issued additional shares under its existing general mandate as part of its ongoing restructuring arrangements with its coordinating committee of creditors. The move follows earlier issuances of “work fee” shares whose sale proceeds are earmarked to settle advisory and coordination fees owed to the creditor group.

The company previously issued 135,591,359 CoCom Work Fee Shares at HK$0.40 each, but disposals to date, raising about HK$17.5 million, have proven insufficient to fully cover the roughly US$8.2 million in work fees. To bridge the shortfall, the board approved the allotment of a further 36,000,000 shares at HK$0.30 per share to GLAS HK, which will sell them to generate additional cash to complete payment of the outstanding fees.

The newly approved tranche represents about 0.09% of Country Garden’s enlarged share capital, with an aggregate nominal value of HK$3.6 million. While modest in dilution terms, the issuance underlines the developer’s reliance on equity-linked arrangements to meet restructuring-related obligations and maintain cooperation from its creditor committee during a critical phase of its financial overhaul.

The most recent analyst rating on (HK:2007) stock is a Sell with a HK$0.28 price target. To see the full list of analyst forecasts on Country Garden Holdings stock, see the HK:2007 Stock Forecast page.

More about Country Garden Holdings

Country Garden Holdings Company Limited is a major Chinese property developer incorporated in the Cayman Islands and listed in Hong Kong. The group focuses on residential and related real estate projects, and is currently undergoing a complex debt restructuring amid prolonged stress in China’s property market, working with creditor committees and advisers to stabilise its capital structure.

YTD Price Performance: -26.51%

Average Trading Volume: 455,015,750

Technical Sentiment Signal: Strong Sell

Current Market Cap: HK$12.83B

Learn more about 2007 stock on TipRanks’ Stock Analysis page.