Jinke: China's Jinke Property files reorganisation application in court, shares rise

Embattled Jinke Property Group said it had applied to a court for a company reorganisation to resolve its debt risks, becoming one of the first well known Chinese developers to take such a route... Shenzhen-listed shares of Jinke, the country's 50th largest property developer by sales, rose 2.5% by midday on Thursday, after jumping as much as 9.4% earlier in the session. Its Hong Kong-listed property management unit, Jinke Smart Services, slipped 1.2%. Many Chinese property developers have defaulted on their debt obligations since mid-2021, with most of them focusing on a debt restructuring rather than a company reorganisation. China Evergrande Group, the world's most indebted property developer, was ordered by a Hong Kong court to liquidate last month after it failed to make progress on its offshore debt restructuring. Jinke said in a filing late on Wednesday it has officially submitted an application to a court in the southwestern city of Chongqing, and a successful reorganisation would improve its balance sheet and continuous operating ability. If the reorganisation failed, however, the company warned it could face bankruptcy and a delisting. The Chongqing-based private developer, with $1.6 billion worth of onshore bonds, first defaulted on a yuan debt tranche in May 2022. In May 2023, Chongqing Hengrui Constructional Engineering, a Jinke supplier, filed a bankruptcy reorganisation petition against the developer in a court, but the petition has not been processed by the court, according to local media. Last July, the developer entered into an agreement with a unit of state-owned Great Wall Asset management under which the unit would take part as a strategic investor in Jinke's prepackaged reorganisation process. (Reporting by Clare Jim; Editing by Muralikumar Anantharaman)