Creditors are holding a vote on whether to give Vanke, which has $50 billion of interest-bearing liabilities, more time to forestall a default, reports Bloomberg. If they vote not to, it would mark a new phase in the country’s real estate woes that have already prompted $130 billion of defaults as well as restructurings and liquidations at other developers, including giants like Country Garden Holdings and China Evergrande Group.
Vanke was once the country’s biggest developer before it succumbed to an unprecedented property crisis. Holders of Vanke’s RMB 2 billion ($284 million) bond have until 10am to vote on whether they’ll allow the distressed builder to delay principal payments by 12 months or give it until January 28 to further negotiate the terms. The company didn’t pay the note by its December 15 maturity, leaving it in a grace period until the end of Monday.
If the day ends without payment or agreement to extend it, holders could tip the builder, which has roughly $160 billion of assets and more than 125,000 employees, into default.