By Phuong
Nguyen and Francesco Guarascio
May 23, 2023 5:02 PM GMT+7
A
motorbike drives past Vietnam's property giant No Va Land gallery in Hanoi,
Vietnam May 23, 2023. REUTERS/Francesco Guarascio
HANOI, May 23
(Reuters) - Vietnamese property giant No Va Land Investment Group Corp (NVL.HM) is in talks with creditors to restructure part of its $1
billion foreign debt, according to two people familiar with the matter, amid
turmoil in one of the country's top industries.
Those creditors
include Credit Suisse (CSGN.S), according to one of the people.
The country's
fifth-largest developer by market value has been badly hit with the real estate
sector wracked by a government crackdown on corruption and stricter rules on
corporate bond issuance and refinancing. That has led to a credit crunch while
firms have also had to grapple with a surplus of high-end property.
So far this year, No
Va Land has missed payments on three of its domestic bonds and faces further
repayment obligations worth roughly 14 trillion dong ($597 million) on more
than 30 bond tranches. Last month, its auditor, PwC, expressed
"significant doubt" about its ability to "operate
continuously".
To reduce repayment
pressure, the company is trying to negotiate deals with foreign creditors,
according to the people. They declined to be identified because the information
was not public.
No Va Land's total
exposure to foreign creditors was worth about $1 billion at the end of last
year, comprising bonds as well as loans with short and long-term maturities,
according to one of the sources.
The company has
reached deals with some creditors and is considering options to restructure
other parts of its foreign debt, the source said.
The second person said
talks were underway with Credit Suisse and at least one other creditor.
Credit Suisse, which
has arranged some of No Va Land's bond issuance, has committed to loans worth
about $55 million, according to the Vietnamese company's financial statements.
The bank has also co-arranged a syndicated loan worth about $81 million with a
credit facility of $250 million.
Credit Suisse declined
to comment. No Va Land, currently valued at around $1.1 billion after an 83%
plunge in its shares in the last 12 months, did not respond to a Reuters
request for comment.
Among its main foreign
creditors is Warburg Pincus, which invested $250 million last June. Nova Land
has agreed to convert $200 million of that into shares of its subsidiaries,
according to one of the sources.
Warburg declined to
comment.
Another large creditor
is financial firm Seatown, controlled by Singapore's investment giant Temasek,
which has extended about $100 million in loans, according to No Va Land's
financial statements.
Seatown did not reply
to a request for comment.
One of the sources
said No Va Land was seeking to sell assets to service its debt, but a third
source familiar with the matter said the company has struggled for months to
find buyers.
No Va Land's total
debt, including domestic loans and bonds, is about $2.7 billion, equivalent to
24% of its assets.
($1 = 23,443.0000
dong)
Reporting by Phuong
Nguyen and Francesco Guarascio @fraguarascio; Editing by Sumeet Chatterjee and
Edwina Gibbs
MAY 22, 2023 4:23 PMUPDATED A MONTH AGO
Vietnam
property developer No Va Land delays bond payments
By Reuters Staff
HANOI, May 22 (Reuters) - Vietnam’s leading property developer No Va Land has delayed payments on a 1 trillion dong ($42.66 million) bond that matured on May 18, as the company faces a credit crunch amid difficult market conditions.
No
Va Land is among the hardest-hit by turmoil in Vietnam’s real estate sector,
which has been caused by high debt, a surplus of high-end property, and has
been exacerbated by tighter credit rules adopted last year and the arrest of
high-profile businesspeople.
The
company’s shares on Monday were trading at a value 83% lower than a year ago,
as it struggles to make repayments and scrambles to sell assets.
The
company said it was in talks with bondholders to extend the maturity of the
bond, according to a disclosure made to the Hanoi Stock Exchange on Monday. It
needs to pay back the principal and nearly 64 billion dong in interest.
No
Va Land, which has 31 active bonds maturing this year worth roughly 14 trillion
dong according to Refinitiv data, in February missed principal and interest
payments on another two lots of bonds due to liquidity issues.
Access
to credit for property developers has been eased by the government recently but
the sector remains on edge.
No
Va Land, which was founded in 2007 and is active mostly in residential property
and luxury resorts, did not immediately respond to a request for comment. ($1 =
23,443 dong) (Reporting by Phuong Nguyen; Editing by Kanupriya Kapoor)
Our
Standards: The
Thomson Reuters Trust Principles.
https://www.reuters.com/article/vietnam-novaland-idUSL4N37J1SP
APRIL 18, 2023
5:27 PMUPDATED 2 MONTHS AGO
Auditor
PwC raises concerns over Vietnamese property developer No Va Land
By Reuters Staff
2 MIN READ
HANOI,
April 18 (Reuters) - Auditor PricewaterhouseCoopers (PwC) on Tuesday cast doubt
on the financial viability of one of Vietnam’s top listed property developers,
No Va Land, which faces large bond paybacks this year amid difficult market
conditions.
The
company is among the hardest-hit by widespread turmoil in Vietnam’s real estate
sector, which has been struggling for months because of a surplus of high-end
property, high debt, stricter rules on bond issuance and refinancing, and
arrests of high-profile business executives.
No
Va Land, which has 34 active bonds maturing this year worth roughly 16 trillion
dong ($683.88 million) according to Refinitiv data, said in its financial
statements released on Tuesday that it had “enough resources to meet due
obligations in the next 12 months”.
PwC
approved the financial statements but expressed “significant doubt about (No Va
Land’s) ability to operate continuously”.
“No
Va Land’s businesses were significantly affected by the real estate market and
the corporate bond liquidity,” the auditor said in a report.
The
company recorded revenues of 11.15 trillion dong ($474.47 million) and a net
profit of 2.181 trillion dong ($92.81 million) for 2022, down 26% and 37%
respectively from the previous year.
In
response to the auditor’s concerns, No Va Land said in a statement to the
securities commission on Tuesday the group faced obstacles but was able to meet
its debt obligations, thanks to the government’s support.
Vietnam
last month softened rules on bond paybacks and access to credit for property
developers.
The
company, one of the biggest issuers of corporate bonds among Vietnam’s property
firms last year, has said it is in talks with bondholders to reschedule
payments or swap bonds for real estate products owned or developed by No Va
Land.
$1
= 23,500.0000 dong Reporting by Phuong Nguyen; Editing by Kanupriya Kapoor
Our
Standards: The Thomson Reuters Trust
Principles.
https://www.reuters.com/article/vietnam-novaland-idUKL4N36L267
NOVEMBER 7, 2022 12:02 PMUPDATED 7 MONTHS AGO
Vietnam's
second-biggest property developer faces cash crunch -sources
By Reuters Staff
3 MIN READ
HANOI,
Nov 7 (Reuters) - Vietnam’s second-biggest listed developer, No Va Land, is
firing staff and seeking urgent asset sales, company and industry sources said,
as it struggles to pay creditors in the latest sign of distress in the
country’s real estate sector.
The
company’s stock price was down by nearly 7% on Monday at 0400 GMT and has lost
nearly 40% since the beginning of this year, reaching its lowest level since
April 2021.
Two
sources with direct knowledge of the matter told Reuters the company was trying
to sell distressed assets, including hotels and resorts, to raise cash to pay
back loans and fund its operations. The sources declined to be named because of
the sensitivity of the matter.
No
Va Land did not immediately respond to an emailed request for comment.
The
liquidity squeeze is the result of the authorities’ crackdown on the market for
privately placed corporate bonds, which have been widely used as an alternative
source of cash by real estate firms after a tightening in lending conditions
since the middle of this year.
“Debts
are coming due this year-end and, with the current tightening regulations on
loans given to real estate firms, it’s hard for the company to have cash,” one
of the sources said.
The
company has been asked by Vietnam’s central bank to redeem some of its
corporate bonds because they had been missold to investors without proper information
about the risks, a third source said, aggravating its liquidity woes.
Founded
in 2007, No Va Land is active mostly in residential property and luxury
resorts. It is Vietnam’s second-biggest listed property firm, with a market
capitalisation of $4.7 billion, after Vingroup’s real estate unit Vinhomes.
No
Va Land last month posted a net profit of about 2 trillion dong, down 19%
against the same period last year because of higher expenses caused by the
stronger dollar, according to the company filings.
Demand
in Vietnam’s real estate market is expected to stay strong through 2023,
Moody’s said in a report in late August.
A
fourth source, a supplier for one of No Va Land’s projects, said his 200
billion dong ($8 million) worth of raw materials were stuck as the project was
being put on hold.
During
the past month, the company has laid off about half of its workforce, and most
of its ongoing construction has been put on halt, three sources said.
On
Monday, No Va Land chairman Bui Xuan Huy told state-run newspaper Tuoi Tre that
market developments were unfavourable, and the company had been forced to cut
staff.
$1
= 24,860.0000 dong
Our
Standards: The Thomson Reuters Trust Principles.
https://www.reuters.com/article/vietnam-markets-housing-idUSL4N3230P1
SEPTEMBER 11, 20202:39 PMUPDATED 3 YEARS AGO
Exclusive:
Vingroup weighs selling school, health units as Vietnam's biggest firm
refocuses
https://www.reuters.com/article/vietnam-vingroup-idINKBN2620VN
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