Sunac China shares plunge after liquidation petition filed against developer

HONG KONG (Reuters) - Sunac China shares dropped as much as 30% on Friday after a liquidation petition was filed against the indebted developer, making it the latest company to face such a move amid an unprecedented debt crisis in China's property sector.

The petition has been filed by a unit of state-owned asset manager China Cinda Asset Management and a hearing is scheduled for March 19, the Hong Kong judiciary's website showed late on Thursday.

Sunac shares in Hong Kong were down as much as 29.7% to HK$1.23 in the morning trade on Friday, on course for the biggest one-day percentage drop since Oct. 8, according to LSEG data.

Sunac did not respond immediately a request for comment.

Sunac joins other Chinese developers including Country Garden (HK:2007 ) and state-backed Sino-Ocean in facing a liquidation petition in a sector that has been reeling from a liquidity squeeze since 2021 and has seen a growing list of developers defaulting on their debt repayment obligations.

Beijing has rolled out a raft of measures over the past year to revive the country's economically crucial property sector, but the measures have had little impact on homebuyer confidence in the world's second-largest economy.

Sources told Reuters this week that Sunac told bondholders that it was unlikely to meet an offshore bond maturity deadline in September this year, which is part of the developer's first round of debt restructuring completed in 2023.



Sunac, which prior to the debt crisis that jolted the property sector in 2021 ranked among China's top developers by sales, was the first to complete a comprehensive overhaul of its $9 billion offshore debt in November 2023.

Sunac had faced an earlier liquidation petition in 2022 that was withdrawn in 2023.

Source: Investing.com