Weil has acted as counsel to the ad hoc group of bondholders in relation to the successful restructuring of more than US$7 billion of offshore debt of China Aoyuan Group Limited (“Aoyuan”) and its subsidiary, Add Hero, including over $3 billion of offshore bond debt. 

Aoyuan is a leading commercial and residential property developer that focuses on the Guangdong-Hong Kong-Macao Greater Bay Area and covers four major regions in the PRC. It was one of a number of PRC property developers to have defaulted on its offshore debt obligations, and the restructuring has aimed to provide Aoyuan with a more stable and sustainable capital structure going forward. 

The restructuring reached a significant milestone in January when the innovative dual and parallel schemes of arrangement were approved by the Hong Kong court and recognized by the U.S. Bankruptcy Court, following sanction of the schemes by courts in the Cayman Islands and British Virgin Islands in December last year. The ruling by Judge Jonathan Harris in the High Court of Hong Kong was reached after a two-day trial.

The Weil team was led by Hong Kong Restructuring partner Kathleen Aka and included counsel Graham Price and associates Minna Zhang and Isolde Tsukabayashi. 

“We are pleased that this innovative, benchmark-setting restructuring has reached successful completion after a year of active and complex negotiations, court processes and transaction execution. We have been fortunate to work closely with Aoyuan and its advisers, Linklaters and KPMG, as well as Moelis as financial adviser to the ad hoc group. All parties involved focused on progressing the transaction efficiently whilst protecting respective client interests, and the process has been conducted professionally and cordially from start to finish,” Kathleen commented. “It is an achievement for Aoyuan and its creditors, and serves as a blueprint for other China real estate situations.”

The successful completion of this complex restructuring is testament to Weil’s market-leading restructuring capabilities in Asia, and illustrates Weil Asia Restructuring team’s ability to guide clients through the entire process of managing distressed assets and investments in the most challenging situations.