Latham Advises Ad Hoc Bondholders on Sunac’s US$9.6 Billion Offshore Debt-for-Equity Restructuring

"Latham & Watkins advised an ad hoc group of bondholders in Sunac China Holdings' US$9.6 billion offshore restructuring, implemented by a Hong Kong scheme of arrangement sanctioned on 5 November 2025. Under the scheme, Sunac will exchange all scheme debts for two mandatory convertible bonds (6‑month and 30‑month) that convert into listed shares."

Latham & Watkins advised an ad hoc group of bondholders in the second-round offshore debt restructuring of Sunac China Holdings Limited (1918.HK). The restructuring was implemented by a Hong Kong scheme of arrangement that was sanctioned by the Hong Kong Court on 5 November 2025. Pursuant to the scheme, on the restructuring effective date Sunac will exchange all of its scheme debts, totaling US$9.6 billion, into two types of mandatory convertible bonds (MCBs): one with a six-month tenor and one with a 30-month tenor, to be issued to scheme creditors. Both classes of MCBs will be mandatorily converted into the company’s listed shares at maturity, or earlier at the election of the bondholders. The transaction represents the first 100 percent debt-for-equity swap implemented by a PRC property developer since the onset of the Chinese property sector crisis in 2021 and secured overwhelming support from scheme creditors, with close to 95 percent in value of scheme debts voting in favour of the scheme. Latham & Watkins represented an ad hoc group of bondholders with a team composed by: Howard Lam (Hong Kong restructuring partner); Flora Innes (counsel); Shirley Zhang (associate); Michael Hardy (Hong Kong partner, structured finance).

Latham Advises Ad Hoc Bondholders on Sunac’s US$9.6 Billion Offshore Debt-for-Equity Restructuring

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