Under the continuous influence of the cold winter of real estate, many 100 billion real estate enterprises frequently burst out bad news.
Recently, R & F real estate, one of the “five tigers in South China”, was exposed that its equity of 81 million yuan had been frozen, while the previously frozen equity of the group had exceeded 170 million yuan.
another 81 million yuan of frozen equity
It is understood that recently, Guangzhou R & F Real Estate Co., Ltd. added equity freeze information. The subject enterprise of equity freeze is R & F (Beijing) Real Estate Development Co., Ltd., the amount of equity freeze is 81 million yuan, and the Executive Court is Yancheng intermediate people’s Court of Jiangsu Province. Previously, R & F real estate has been frozen, with an equity of more than 170 million yuan.
Tianyan inspection shows that up to now, R & F has involved 103 legal proceedings, of which 47 are financial loan contract disputes and 15 are commercial housing sales contract disputes. The total amount of the case as defendant / appellee exceeds 38 million yuan.
Public information shows that R & F group was founded in 1994 and headquartered in Guangzhou. At present, it has developed into a comprehensive group focusing on real estate development and diversified development in the fields of hotel development, commercial operation, sports and tourism, Internet industry and trade, medical care and health, design and construction and innovative service platform. In 2005, R & F was listed on the main board of the Hong Kong Stock Exchange and became the first mainland real estate enterprise to be included in the Hang Seng China enterprise index.
In 2017, R & F also participated in the acquisition of Wanda rongchuang and took over all the equity of 77 Wanda Hotels with a 60% discount of about 20 billion. However, this was regarded as a great bargain at that time. Under the continuous impact of the epidemic and the downward trend of real estate, it has increasingly become a big burden.
real estate constantly saves itself in the cold winter
In the cold winter of real estate, R & F real estate has a hard time.
According to the semi annual report data of R & F real estate last year, during the first half of 2021, the group’s total turnover was 39.49 billion yuan, an increase of 18% over the same period last year; The net profit was 3.18 billion yuan, a decrease of about 19% over the same period last year. In addition, compared with the same period last year, the net profit of the group’s property development also decreased by 15%.
According to the data, as of the first half of 2021, R & F’s total borrowings were 143.35 billion yuan, but the debt due within one year accounted for 36%, about 52 billion yuan; The working capital is only 12.8 billion yuan, and the capital gap is nearly 40 billion yuan.
R & F real estate said in its semi annual report that in 2021, the company has solved most of its short-term debts and responded to the fluctuations of the business environment. The company will maintain a prudent land acquisition strategy, accelerate the progress of agreed sales, and use available funds to further reduce the overall debt burden, so as to resist further market fluctuations, It is expected to continue to accelerate the improvement of the company’s debt and cash flow during the year.
In terms of share price, since the second half of last year, R & F real estate’s share price has been falling. As of the closing on January 6 this year, R & F real estate reported HK $3.15/share, down 68% from the high of 9.86 yuan / share last year. At present, the total market value of R & F real estate is HK $11.8 billion.
With the continuous decline of the real estate industry, R & F real estate revealed that since the second half of 2021, the reduction of bank loans has reduced the opportunities for real estate developers to obtain domestic capital. At the same time, real estate sales have also decreased. This also makes it difficult to obtain offshore capital, which limits the source of funds for real estate developers such as R & F real estate to deal with maturing bills.
However, R & F real estate has also taken many measures to save itself, trying to alleviate the company’s short-term liquidity pressure and improve the company’s overall financial situation.
On September 20 last year, R & F real estate announced that in order to support the group, executive director and major shareholders Li Silian and Zhang Li will provide shareholder funds of about HK $8 billion, which is expected to be completed in the next 1-2 months, of which about HK $2.4 billion will be received on September 21.
Meanwhile, Country Garden Service announced that it signed an equity transfer agreement with R & F property to acquire 100% equity of Fuliang global for no more than RMB 10 billion, so as to indirectly acquire 100% equity of R & F property. Because R & F property was held by Li Silian and Zhang Li respectively, 46.48%, there is also speculation in the industry that the capital of HK $8 billion comes from this transaction.
On the other hand, tension, chief executive of R & F real estate, frequently increased his shares. On November 17 last year, the Hong Kong Stock Exchange showed that tension purchased 1.45 million shares of the company with an average of HK $4.1145 per share on November 15, and the shareholding ratio increased from 27.73% to 27.77%.
Prior to November 11-12, tension had increased its holdings of 1.21 million shares and 1.4 million shares respectively, with the price per share of HK $4.701 and HK $4.4208 respectively, with a total amount of about HK $11877300.
Although the company has been trying to reduce its liabilities and improve its operation by selling assets and reducing land acquisition, R & F real estate is still facing the dilemma of debt default.
On December 16 last year, according to the S & P global rating report, the long-term main credit rating of R & F real estate and its subsidiary R & F Hong Kong was lowered from “B -” to “CC”, with a negative outlook.
The report shows that the reason for the downgrade of R & F real estate is that the proposed transaction is regarded as a discount restructuring because the company seeks a discount offer to repurchase and extend the debt maturity. In addition, S & P believes that R & F may not be able to repay its preferred US dollar notes when they mature in January without the proposed restructuring.
voting results of US $725 million bond repurchase
On December 15 last year, R & F real estate announced that its overseas wholly-owned subsidiary, easy tactical limited, planned to offer to repurchase and seek consent for the “gzrfpr 5.75% 1 / 13 / 22” US dollar senior notes. The US dollar bond was issued on January 13, 2017, with a duration of US $725 million, an issue interest rate of 5.75%, and a maturity date of January 13, 2022.
For the bond, R & F real estate has given three schemes for creditors to choose.
Option a will redeem the notes with cash of US $830 and corresponding interest for every US $1000 of the total principal amount outstanding and effectively delivered and accepted in accordance with the offer.
Option B will redeem 50% of the notes at par value and corresponding interest for every $1000 of the total principal amount outstanding and effectively delivered and accepted in accordance with the offer.
In response to the request for consent to the amendment of the terms of the existing notes in scheme C, R & F real estate plans to extend the maturity date of the notes to July 13, 2022. At the same time, it can redeem all or part of the notes in advance at any time before this date, with the redemption amount of 100% of the principal amount and corresponding interest, and the noteholder will receive a consent fee of US $1 in cash.
Among the above schemes, two schemes involve repurchase by offer, and one scheme is to seek consent.
On January 5, R & F real estate announced that the scheme related to the company’s US $725 million debt due on January 13, 2022 had produced the final voting result. Scheme a received 71.6% of the votes and scheme B received 24.19% of the votes.
The announcement also pointed out that at present, due to the continuous fluctuation of China’s real estate industry, the proceeds from some assets to be sold by the company may not be cashed on the settlement date. Therefore, the actual amount of special funds that Yilue expects to use to promote the repurchase by offer and seek consent may be lower than the previously expected amount of about US $300 million. Although the progress of some expected asset sales has been delayed, the company will continue to take positive measures to support its liquidity situation up to the settlement date.
S & P had previously said that it would reassess the credit status of R & F real estate after the transaction was completed. However, in addition to the US $725 million debt due in January 2022, the company will have about RMB 9.5 billion of domestic bonds due and enter the resale period in the remaining time of 2022, and US $648 million of overseas bonds due. Even if the proposed transaction can be successfully completed, the company’s resources and liquidity may still be further reduced, making the debts due later more vulnerable to default risk.
(China Fund News)
