Kaisa's Offshore Bondholders Make New Counter Proposal - Full Term Sheet Issued

HONG KONG, Jan. 18, 2016 /PRNewswire/ -- Following various news reports, BFAM Partners (Hong Kong) Limited ("BFAM Partners"), the alternative investment management firm, today confirmed that on 14 January, 2016, a group of large bondholders of offshore debt issued by Kaisa Group Holdings Limited, including BFAM Partners and Farallon Capital Asia Pte. Ltd., met with and submitted to the Company's advisors a proposal regarding the potential restructuring of the Company's offshore debt.

This Proposal is substantially consistent with almost all of the terms of the Company's proposed restructuring plan as announced on January 10, 2016, does not introduce any incremental execution lead time or complexity, and at the same time provides greater return and certainty for the Company's offshore bondholders as a whole. As such, the bondholder group believes that this Proposal provides a more comprehensive solution to improving the Company's financial state than the terms of the existing restructuring that the Company is contemplating entering into, and is demonstrably in the best interest of all of the Company's stakeholders.

Benjamin Fuchs, CIO of BFAM Partners said, "We have presented a counterproposal based on the company's current terms which we do not believe introduces additional execution risk or complexity. Our proposed terms provide a better outcome for bondholders and we believe they will gain widespread support. Given the size of our group it is unlikely that the company can successfully implement its current proposal and so we encourage bondholders not to sign the company's RSA. We recommend they join us in urging the company to amend its terms to reflect our proposal, which is more consistent with the underlying fundamentals of the business."

The Proposal provides the following key additional benefits as compared to the Company Proposal:

• Results in a materially higher NPV to bondholders of 87% versus 75% implied under the Company Proposal
  
• Provides greater security and certainty of debt service for bondholders, who otherwise face greater risk as a result of limitations on access to available cash imposed by the ongoing "onshore" restructuring process

Specifically, the Proposal's terms are substantially consistent with those of the Company Proposal, except for the following key differences:

• Higher coupon, primarily with respect to the PIK component
  • 0.5% cash coupon component in Year 1 (vs. zero under the Company Proposal)
  • Approximately 2%~6% higher PIK coupon (and cash interest toggle) component in all years (vs. the Company Proposal)
    
• Lower conversion price for convertible bonds
  • Lower of HK2.34 per share or 125% of the 30-day VWAP post-trading resumption (vs. HK2.34 under the Company Proposal)
    
• Additional cash collateral and capital buffer
  • US$200m of 8-year zero-coupon junior capital to be injected by existing shareholders or onshore creditors and held in escrow for the benefit of offshore debt service

Please find the detailed term sheet reflecting the new proposal here.

Enquiries:

Newgate Communications
Richard Barton
M: +852 9301 2056
E: Richard.barton@newgate.asia