(Yicai) July 1 -- New World Development said it has secured a HKD88.2 billion (USD11.2 billion) refinancing package from creditor banks to roll over and restructure its offshore unsecured debt, giving the builder more flexibility to better manage its ongoing business and financial needs.

New World has refinanced part of the debt, including bank loans, through a new refinancing facility and aligned its other offshore unsecured bank loans with the new terms, the Hong Kong-based company announced late yesterday. The facility consists of multiple bank loan tranches with different maturities, the earliest being June 30, 2028.

On May 30, New World said it would defer interest payments due on four US dollar perpetual bonds worth USD3.4 billion, leading to concern among investors. The firm's stock price [HKG: 0017] plunged over 10 percent to a record low of HKD4.28 (55 US cents) at one point on June 2, with investors selling many of its bonds that same day. 

The shares closed down 0.2 percent at HKD5.70 each yesterday. The Hong Kong bourse is closed today to celebrate the special administrative region’s 28th anniversary.

Due to the downturn in China's real estate market, New World's debt has continued to increase. Its debt ratio was 57.5 percent as of the end of last year, up from 55 percent six months earlier, while its consolidated net debt topped HKD124.6 billion (USD15.9 billion), with debt due within one year at about HKD32.2 billion, according to its latest financial report.

New World has also suffered substantial losses, reporting a net loss of HKD19.7 billion (USD2.5 billion) in the fiscal year ended June 30 last year, its first in the past two decades. Its loss reached HKD6.6 billion (USD840.8 million) in the six months ended Dec. 31.

To alleviate its financial burden, New World sold several non-core assets in the Chinese mainland and Hong Kong in the fiscal year 2024, recouping about HKD8 billion, it said previously, adding that the company plans to recoup another HKD26 billion this fiscal year by selling more assets.

In a separate announcement yesterday, New World said it had completed its contract sales target of HKD26 billion for the fiscal year 2025, continuing to deliver projects despite debt pressures.

Editors: Dou Shicong, Martin Kadiev