S&P Global Ratings raised Greenland Holdings Corp Ltd (600606.SS) by one notch to “CCC” on Wednesday, after the Chinese state-backed property developer completed a one-year maturity extension on $500 million in senior unsecured notes.
Last Wednesday, S&P downgraded Shanghai-based Greenland to “selective default”, after the firm proposed and later completed a one-year maturity extension of its $500-million bonds originally due on June 25.
The rating agency said at that time it viewed the proposal to extend the maturity as “a distressed debt restructuring and tantamount to a default”.
On Wednesday, while upgrading Greenland rating on completion of the maturity extension, S&P said the developer continued to face heightened repayment risk owing to a significant amount of debt maturities in 2022 and its “exceptionally weak” liquidity.
Greenland declined to comment on the latest rating action.
“Repayments for Greenland’s remaining U.S. dollar-denominated senior notes due in 2022 are subject to high uncertainty, in our assessment,” the rating agency said in its note.
Over the next 12 months, Greenland has offshore debt maturities of about $2.4 billion, as per S&P estimates. Greenland’s repayment ability will largely depend on cash collection from sales and asset disposals, it said.
A string of Chinese property developers have defaulted on their offshore debt obligations and have had their ratings slashed in the last year as a result of an unprecedented liquidity squeeze and slowing sales.