Chinese builder Fantasia unveils sweeping $4.7 billion debt overhaul plan

March 13 (Reuters) – Embattled Chinese property developer Fantasia on Friday unveiled detailed terms of its offshore debt restructuring, including plans to issue new equity, convertible bonds and long-dated secured notes.

Fantasia is attempting to restructure about $4.66 billion of its offshore debt, through new shares, mandatory convertible bonds and about $1.44 billion in new secured notes to settle creditor claims.

The property developer defaulted on its debt in 2021, among the many to have done so amid a crisis in China’s real estate sector. A growing number of companies have reached restructuring agreements with their creditors.

As of June 30, 2025, Fantasia had about 66,972 million Chinese yuan ($9.71 billion) of debt, it said in a statement.

Under the terms of the debt restructuring proposal, the Shenzhen-based developer plans to allot 5.14 billion fresh shares to scheme creditors at HK$1.52 apiece.

Fantasia will also issue zero-coupon mandatory convertible bonds worth $501.2 million, which would convert into 2.57 billion shares at the same price of HK$1.52.

It will also issue $632.5 million in secured notes due 2031 and $809.6 million due 2034 — a total of $1.44 billion — both carrying a 3% coupon.

Fantasia will also convert the entire HK$1.31 billion ($167.36 million) shareholder loan balance by issuing 4.38 billion new shares to its controlling shareholder at HK$0.30 each, with all accrued interest permanently forgiven once the restructuring becomes effective.

Separately, controlling shareholder Baby Zeng will inject $6 million as a shareholder loan into the company, with an interest of 8% per annum. These funds will be funneled towards the fees and expenses of the proposed restructuring.

($1 = 6.8961 Chinese yuan renminbi)

($1 = 7.8275 Hong Kong dollars)

(Reporting by Rajasik Mukherjee; Editing by Sahal Muhammed)