CoGard Causes Confusion, Vedanta Resources Surprises With Vedanta Ltd. Stake Sale, MGM China Books Earnings Win

While closely watched Dalian Wanda managed to transfer funds at the 11th hour to redeem its $400 million offshore notes due July 23, the repayment failed to allay concerns around China’s real estate market. Turmoil has more recently spread to state-backed names such as Greenland Holdings and Sino-Ocean Group, and despite declarations of impending policy easing, the position of key developers remains precarious. Country Garden, or CoGard, recently announced an expected net loss for the first six months of 2023, compared to a net profit of CNY 1.91 billion ($268.5 million) for the year earlier period. In the same announcement, CoGard declared it would actively seek guidance and support from the government and regulatory authorities. The situation spiraled further this week on a perceived credit negative signal, with 20% of shares being isolated through a donation to a family operated foundation. That was swiftly followed by the cancellation of a reported planned sale of shares, with no reason given for the walk-back. The company then announced the planned buyback of up to 10% of issued shares, to demonstrate “confidence in its long-term business prospects”.

Vedanta Resources Ltd. or VRL, decided to monetize a 4.3% stake in Indian listco Vedanta Ltd. or VDL, held through its stepdown subsidiary Twinstar Holdings Ltd, to raise as much as $501 million. The move surprised, as the London headquartered metals to mining company had previously taken on additional debt to up its stake in VDL to plug leakage of dividends from its opcos to public shareholders. But raising funds through a secondary placement comes with S&P Global breathing down VRL’s neck to provideto a credible refinancing strategy for its $1 billion 13.875% bonds due January 2024. Consequently, the London headquartered metals to mining company’s bond curve was up two to five points on Aug. 3, following the news.

MGM China released results showing an outperformance against Macau’s recovering gaming market, which is emerging from an extended Covid-19 lockdown. MGM China reported total revenue of HKD 5.809 billion ($744.3 million) for the second quarter ended June 30, up 417.7% year over year from HKD 1.122 billion, and profit attributable to owners of the company was HKD 669.6 million, reversing an attributable loss of HKD 1.375 billion. First half total revenue of HKD 10.649 billion was up 231.1% year over year from HKD 3.216 billion, and the attributable profit reached HKD 820.9 million, reversing an attributable loss of HKD 2.404 billion.
 
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Two holders of Agile Group’s $500 million 5.75% senior notes due Jan. 2, 2025 told Reorg that they have received a semi-annual interest payment on the notes as of Aug. 3. The coupon of around $14.4 million, was originally due on July 2 and had a 30-day grace period. On Aug. 1, Agile placed 346 million existing shares to raise about HKD 387.2 million ($49.6 million) at HKD 1.13 per share. It intends to use the proceeds to repay debt and for general corporate purposes.
 
Indian renewable energy company Azure Power Global has filed an appeal with the New York Stock Exchange against the NYSE’s decision to delist its shares due to an excessive delay in filing its audited financial reports for fiscal year ended March 31, 2022 and thereafter. Filing the appeal may provide the company around two to three months to avoid a potential event of default, or EoD, under its two USD bonds.
 
Another Indian renewable company ReNew Power Pvt. Ltd. launched a consent solicitation process to amend certain terms of its $270 million, 5.875% senior secured notes due 2027, including sections relating to events of default, acceleration, indebtedness and preferred stock and asset sales.
 
A single judge bench of the Delhi High Court directed the resolution professional, or RP, of Go Airlines (India) Ltd. and SMBC Aviation Capital, a lessor of the carrier, to maintain status quo on the issue of handling and carrying out “non-revenue activities” in respect of the aircraft. The order was passed in response to a petition by SMBC Aviation Capital alleging that the RP of Go Airlines violated a previous order passed by the same court that restrained the company, its directors, employees, the RP, and their representatives from removing, replacing, or taking out any part or component, or any relevant records from 30 aircraft leased to the airline, without prior written approval of the lessors.
 
Byju’s U.S. affiliate, Byju’s Alpha, and $1.2 billion term loan agent Glas Trust filed trial briefs outlining their positions on the company’s alleged loan defaults ahead of a trial on the agent’s Delaware suit to confirm its designee’s control over Byju’s Alpha. The trial is scheduled for Friday, Aug. 4, at 9:15 a.m. ET. The agent and its designee, Timothy Pohl, assert the company defaulted by failing to deliver audited financials between March and September 2022 and failing to secure the accession of affiliate Whitehat India as a guarantor. According to the agent, Byju’s Alpha conceded these defaults in three forbearance amendments between October 2022 and January 2023. When the final forbearance expired on Feb. 10, the agent says it properly accelerated the loans and enforced its self-help remedies by becoming Byju’s Alpha’s sole shareholder under stock pledges and replacing former director and officer Riju Ravindran (younger brother of Byju’s founder, Byju Ravindran) with Pohl. Byju’s, Riju Ravindran and affiliate Tangible Play Inc. counter that the agent and Pohl are acting for “a group of investors led by distressed debt funds to extort better (and un-bargained-for) economic terms under the Term Loans.” The “non-monetary,” “technical” and “de minimis” defaults alleged by the agent “cannot possibly justify acceleration of the debt or seizure of control of the Company,” the Byju’s parties argue.
 
Vinhomes Joint Stock Company, the real estate subsidiary of Vietnamese conglomerate, Vingroup Joint Stock Company, held non-deal roadshows with credit investors in Singapore and Hong Kong for a potential USD note issue. The company currently has no outstanding USD notes unlike its parent Vingroup, but has VND 6.5 trillion ($273.4 million) onshore notes outstanding on its books.
 
John Riady, CEO of Indonesia property developer and healthcare conglomerate, PT Lippo Karawaci Tbk., or LPKR, said in an earnings call on July 28 that for at least the next year the company will continue to focus on developing properties priced below IDR 2 billion ($132,440), which account for 60% to 70% of the company’s marketing sales.