CLSA and HSBC, two of the four deal managers of Hilong Holding’s $165.1 million 7.25% senior notes due June 22 have resigned from the position, said one source close and another source familiar with the situation.
The resignation is due to the compliance requirement in the respective banks, that the Hong Kong-listed integrated oilfield equipment and service provider might default on the matured $165.1 million 7.25% senior notes due 22, one of the sources added.
The existing deal managers of the exchange offer are Admiralty Harbour and SPDB International, as
announced today.
HSBC, CLSA and Hilong did not respond to Reorg’s emailed request for comment at publication.
Hilong Holding announced today that approximately 63.45% in aggregate principal amount of the existing notes outstanding have so far been tendered in the exchange offer, which is lower than the minimum acceptance amount of 80%,
as reported.
Hence, Hilong has further extended both the early participation deadline and the exchange expiration deadline to 4 p.m., London time, June 29 and will not be able to repay the existing $165.1 million 7.25% senior notes due today, as the exchange offer has not been consummated,
as reported.
The nonpayment constitutes an event of default under the existing notes and will cross-default its $200 million 8.25% notes due Sept. 26, 2022 but will not automatically result in acceleration,
as reported.
Zhang Jun, chairman of Hilong said in the investor call held on June 16 that the company has $45 million cash available offshore to settle the due June 22 notes and maintains around $40 million for operating purposes,
as reported.
Onshore funding channels of Hilong Holding are all restricted, unless Hilong can complete the exchange offer for its $165.1 million 7.25% senior notes due June 22,
as reported.
Hilong has extended the exchange deadline for several times and the timeline is below:
Date of announcement |
Description |
Early participation date / Expiration deadline |
May 20 |
Exchange offer launched |
May 27 / June 3 |
May 26 |
Revision of the offer and extension of deadline |
June 3 / June 3 |
June 8 |
Further extension |
June 15 / June 15 |
June 16 |
Further extension |
June 22 / June 22 |
June 22 |
Further extension |
June 29 / June 29 |