Kirkland & Ellis advised the ad hoc committee of noteholders in a successful restructuring of the New York law governed three tranches of senior notes in an aggregate principal amount of approximately $450 million issued by Golden Wheel Tiandi Holdings Company Limited (HKSE: 1232), a holding company principally engaged in property development in the PRC.
The restructuring, implemented by way of a scheme of arrangement in the Cayman Islands, was completed on April 11, 2022. It marked the first successful restructuring of the offshore debts of a Hong Kong-listed PRC property company by a Cayman scheme in recent history. The last restructuring of this kind was Kaisa Holdings’ bond restructuring in 2016 which Kirkland counseled the ad hoc committee of bondholders.
Kirkland assisted the noteholders in Golden Wheel Tiandi in (a) obtaining an onshore asset disposal undertaking and protection mechanism with respect to the net proceeds from the sale of certain specified onshore assets earmarked to repay the restructured notes. The mechanism included a PRC escrow account, a PRC cash pledge, and an offshore account charge; and (b) obtaining enhanced information rights and a more flexible enforcement mechanism for the restructured notes. These features were novel in offshore debt restructurings involving China credit and significant for the development of future debt restructuring cases in the PRC.
The Kirkland team was led by restructuring partners Neil McDonald, Jacqueline Wenchen Tang and Thomas Jemmett, with assistance from associates Zoey Zhang and Leeann Chen and transaction manager Eason Li. Debt finance partner Jacqueline Zheng, capital markets partner Louis Rabinowitz and debt finance associate Dora Cheung provided debt capital markets and credit support on this matter.