Sunac gains restructuring support from holders of nine out of 10 onshore bonds, says source

HONG KONG (Reuters) - Sunac China has now won the support of holders of nine of its ten onshore bonds to implement a restructuring that would cut its 15.4 billion yuan ($2.11 billion) onshore debt by more than half, said a source with direct knowledge of the matter.

Progress by the Beijing-based developer towards a landmark restructuring deal for yuan bonds could open the gates to a flurry of such deals this year, as China's property sector gives up on returning to financial health anytime soon.

Sunac, the first Chinese property developer to attempt to restructure its onshore bonds with a steep haircut, needs the consent of holders of all of its 10 onshore bonds.

Once one of China's largest developers, Sunac had received sufficient support from holders of one more onshore bond by an extended deadline on Friday, raising the total number which had won approval to nine, the source, who requested anonymity as the information has not been made public, said on Monday.

Sunac declined to comment.

For the remaining 2.8 billion yuan December 2025 notes, Sunac has said a meeting is scheduled for Jan. 21 to discuss the restructuring plan with bondholders.

Sunac's shares closed 14.6% higher on Monday, after it said on Sunday it had sold 96% of the units it had put on sale on the first day in a Shanghai high-end development, recording contract sales of 6.6 billion yuan.

The share bounce followed a 25.7% slump on Friday after a liquidation petition was filed against Sunac in Hong Kong, reigniting investor concerns about the debt crisis despite efforts by Beijing to revive the sector.

Reuters reported last week that Sunac had told some of its offshore creditors it was unlikely to meet a September maturity deadline for its restructured bonds.

(Reporting by Clare Jim; Editing by Alexander Smith)