Dalian Wanda Commercial Management Group Co.’s planned issuance of an asset-backed security has been terminated, occurring as a unit of the Chinese property firm faces a key deadline for going public.
(Bloomberg) — Dalian Wanda Commercial Management Group Co.’s planned issuance of an asset-backed security has been terminated, occurring as a unit of the Chinese property firm faces a key deadline for going public.
An update regarding the proposed 3.3 billion yuan ($452 million) offering was posted Thursday on the corporate bond information platform on Shanghai Stock Exchange. No reason was given regarding termination of the offering, an application for which was accepted on March 30. That same day, a separate 3.5 billion yuan ABS application was accepted, and that plan is in the feedback stage pending approval, according to the platform.
Wanda Commercial is part of Dalian Wanda Group Co., one of China’s largest conglomerates. Wanda Group has started negotiations on a proposal that would allow it to avoid repaying about 30 billion yuan to investors in a Wanda Commercial unit if an initial public offering isn’t completed this year, according to people familiar with the matter.
Dollar bonds issued by Wanda Group entities were volatile earlier this year amid concerns about the IPO’s fate and potential investment-repayment requirements. Worries hit a peak in July, when Wanda Commercial warned days before a note’s maturity that there was a funding gap of at least $200 million to pay it. That bond was ultimately paid on time, and prices of the conglomerate’s other onshore and offshore notes recovered some.
Wanda dollar bonds are indicated at distressed levels of less than 60 cents, according to data compiled by Bloomberg.
All three major international ratings firms downgraded Wanda Commercial deeper into junk territory in July.
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