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China debt crunch

Evergrande unit Hengda's onshore bondholders reject repayment delay

Developer sought approval to further extend date on returning $670m to 2023

Evergrande defaulted on some payments for its offshore bonds last year.   © Reuters

BEIJING/HONG KONG (Reuters) -- Onshore bondholders of embattled property developer China Evergrande Group's main unit have rejected a proposal to postpone repayment of a 4.5 billion yuan ($671.04 million) bond, a securities filing made by the unit showed on Monday.

Hengda Real Estate Group, Evergrande's flagship onshore unit, said in a filing to the Shenzhen Stock Exchange it is in talks with bondholders to reach an acceptable agreement as soon as possible.

The 4.5 billion yuan worth of bonds, with a coupon rate of 6.98%, were issued by Hengda via the Shenzhen Stock Exchange in early 2020 and became puttable on Jan. 8 this year, according to previous filings by the company.

Hengda earlier won approval from onshore creditors to extend the puttable date to July 8. The company, however, has now failed to secure approval from those creditors to further extend the payment to Jan. 8, 2023.

Struggling with more than $300 billion in liabilities, Evergrande defaulted on some payments for its offshore bonds last year but has been trying to extend the timetables on onshore payments to avoid technical defaults. 

Last week, Top Shine Global, an investor in Evergrande unit Fangchebao, said it had filed a winding-up petition against the developer, as it had not honored a pact to repurchase shares from Top Shine in Fangchebao. 

The developer has said that it would "vigorously" oppose the petition and that the lawsuit would not impact its offshore debt restructuring plan, expected to land by the end of this month.

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