Chinese property developer Neo-China is looking to reduce its foreign debt exposure through cut-price deals for early redemption on convertible bonds due in 2011, Reuters reported. The company plan to cut the early redemption price for its US$167.8 million in zero coupon convertible bonds to US$0.40 to the dollar, down from US$1.20 to the dollar. Neo-China has also offered to let investors delay their bonds’ early redempton date by one year and get US$1.28 to the dollar as an alternative. The proposal follows Chinese company Asia Aluminum’s recent offer to redeem its debt at a knock-down price, causing concern that other Asian issuers may attempt to discount their bond obligations. The statement has provoked a ratings downgrade warning from Standard & Poor’s, which said it is considering reducing Neo-China’s bond rating to its second-lowest level from “CC” to “SD”.