20220228-招银国际-MOLAND-Estimated_recovery_rate_at_57-83__3页_468kb
报告摘要
CMBI Credit Commentary - MOLAND Summary
Core Content Overview
This document provides an analysis of MOLAND's debt restructuring plan and outlines the estimated recovery rates for its existing USD bonds. The restructuring is focused on offshore bonds, and the recovery rate estimates are based on different discount rates (15%-25%). The report is issued by CMB International Securities Limited (CMBIS), a subsidiary of China Merchants Bank.
Debt Restructuring Plan
Modern Land has announced a restructuring plan for its five existing USD bonds, with a total outstanding amount of approximately USD1.3 billion. The plan includes:
- Upfront cash repayment: USD1.7 per USD100 of existing bonds.
- New notes/bonds: USD98.3 per USD100 of existing bonds, issued in five tranches with maturities of 1 to 5 years.
- RSA fee: USD0.2 per USD100 of existing bonds, for holders who consent to the restructuring plan before the RSA deadline of 21 March 2022.
- Approval threshold: 75% of the principal amount of bonds.
- Expected effective date: 31 May 2022.
- Long stop date: 31 July 2022.
Estimated FV of New Notes/Bonds
The fair value (FV) of the new notes/bonds is estimated to be in the range of mid-50s to low 80s, depending on the discount rate used. The FVs are calculated under the following assumptions:
- Discount rates: 15%, 20%, and 25%.
- No cash coupon in the first year.
- 2% cash coupon in the second year.
- Remaining years have cash or PIK (Payment in Kind) options.
| Tranche | FV at 15% | FV at 20% | FV at 25% |
|---|---|---|---|
| Tranche 1 | 74.52 | 61.15 | 50.64 |
| Tranche 2 | 78.08 | 64.20 | 53.18 |
| Tranche 3 | 81.75 | 67.23 | 55.80 |
| Tranche 4 | 81.75 | 67.23 | 55.80 |
| Tranche 5 | 81.75 | 67.23 | 55.80 |
Summary of New Notes/Bonds
| Tranche | Size (USD mn) | Maturity | Cash Coupon | PIK | 1st Year | 2nd Year | 3rd Year Onwards | % of Total Outstanding |
|---|---|---|---|---|---|---|---|---|
| Tranche 1 | 80.00 | 1yr | 7% | 9% | Cash or PIK | 2% cash, rest cash or PIK | All cash | 5.5% |
| Tranche 2 | 180.00 | 2yr | 8% | 10% | Cash or PIK | 2% cash, rest cash or PIK | All cash | 12.4% |
| Tranche 3 | 300.00 | 3yr | 9% | 11% | Cash or PIK | 2% cash, rest cash or PIK | All cash | 20.6% |
| Tranche 4 | 400.00 | 4yr | 9% | 11% | Cash or PIK | 2% cash, rest cash or PIK | All cash | 27.5% |
| Tranche 5 | 494.34 | 5yr | 9% | 11% | Cash or PIK | 2% cash, rest cash or PIK | All cash | 34.0% |
| Total | 1,454.34 | - | - | - | - | - | - | 100.0% |
Estimated Recovery Rates for Existing Bonds
The estimated recovery rates for the existing bonds are 57-83%, depending on the discount rate applied. The recovery rate includes the RSA fee but excludes unpaid and accrual interests up to the restructuring effective date of 31 May 2022.
| Discount Rate | NPV (USD) |
|---|---|
| 15% | 82.80 |
| 20% | 68.43 |
| 25% | 57.10 |
Key Information
- The restructuring plan is only applicable to offshore bonds.
- The RSA fee is USD0.2 per USD100 of existing bonds.
- The approval threshold is 75% of the principal amount.
- The restructuring plan is subject to the RSA deadline of 21 March 2022.
- The estimated recovery rates are based on discount rates of 15%-25%.
- The report includes important disclosures regarding the risks of investing in securities and the independence of the analysis.
Disclaimer and Legal Information
- The report is not investment advice and should not be relied upon for making investment decisions.
- CMBIS is not a registered broker-dealer in the U.S. and is not subject to U.S. regulations regarding research reports.
- The report is distributed only to specific categories of investors in the U.K. and the U.S.
- In Singapore, the report is distributed by CMBI (Singapore) Pte. Limited (CMBISG), an Exempt Financial Adviser.
- The report is for the use of intended recipients only and may not be reproduced or distributed without prior written consent.
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