Linklaters advises on Chinese developer Guangzhou R&F Properties’ jumbo bonds consent solicitation

Linklaters acted as the international legal advisor to J.P. Morgan Securities (Asia Pacific) Limited as the lead solicitation agent, and Arta Global Markets Limited as co-solicitation agent, on the successful consent solicitation for 10 outstanding US dollar bonds totalling approximately US$4.9bn in principal amount by Guangzhou R&F Properties Co., Ltd (Guangzhou R&F).

The highly bespoke proposal involved a combination of maturity extensions, coupon deferral mechanics, asset disposal-linked mandatory prepayments and notes consolidation. It was launched concurrently with a proposal for holders of the relevant bonds to accede to a restructuring support agreement. The consent solicitation received overwhelming support, with all 10 series of bonds obtaining the necessary votes in favour. Linklaters assisted in the negotiation and drafting of all consent solicitation and bond restructuring documents as well as the announcements and investor communications, drawing on the firm’s expertise in the debt capital markets, high-yield and restructuring & insolvency practices.

This successful consent solicitation enables Guangzhou R&F to extend its debt maturity profile, strengthen its balance sheet and improve cash flow management.

The transaction was led by Linklaters’ Asia Managing Partner William Liu, restructuring partner Andrew Payne and capital markets partner Taiki Ki, with support from counsel Min Fang, and managing associates Leeza Lee and Cheng Rui Chua.

Linklaters’ Asia Managing Partner William Liu, commented:

“Linklaters has a long-standing reputation in the market for our capability in assisting clients in navigating the ongoing Chinese real estate market crisis. This successful consent solicitation once again demonstrates our strength in handling complex and challenging debt crises.”