Troubled property company Greentown China Holdings will buy back almost all of its US$400 million in foreign bonds after raising capital on the domestic market, the Wall Street Journal reported. Part of Greentown’s US$290.2 million capital injection came from Industrial and Commercial Bank of China, indicating that domestic lenders are willing to support Chinese firms paying off foreign debt holders. In the past, Chinese companies were restricted from using domestic loans for this purpose. The new investment support allowed Greentown to avoid a default on its bond covenants. Investors holding 89.72% of Greentown bonds will be paid 85 cents on the dollar in the deal, representing a 25% premium over where bonds were trading late last month. Other domestic firms have not been so lucky. Earlier this year, Asia Aluminum Holdings offered to redeem bonds at 27.5 cents on the dollar and payment-in-kind notes at just 13.5 cents on the dollar. The deal failed and the court appointed provisional liquidators. While the fresh capital has helped Greentown shore up its position, analysts say the company is still at risk due to the high interest rates on the new capital and another batch of convertible bonds, which will mature in 2010.