Highway (Reuters) – China Van Ke, a cash-strapped China, said its major shareholder, state-owned Shenzhen Metro, is providing it with 2.8 billion yuan ($383.12 million) in loans, and the government is stepping up efforts to stabilize real estate during the signing Developer.
In return, Vanke will commit to pledge 211.5 million shares, its listed property services division Onewo Inc, as collateral, the company said in a filing late Monday.
The loan is the first liquidity support from Shenzhen Metro after Vanke’s senior management restructuring last month, which added state oversight and intervention to curb any non-compensation risks.
Vanke’s bonds rose on Tuesday after the loan announcement, with morning trade bidding at 97.111 cents at 97.111 cents, up from 94.8 cents a day in offshore bonds in May 2025, while its The bonds were 13.5% in March 2027.
In another document on Monday, Vanke issued a repayment announcement for the mature 3 billion yuan notes on February 16, indicating that it will be repaid on time.
Analysts say Shenzhen Metro loans show efforts made by authorities to avoid goods defaults. They added that this was a good deal for Vanke, as the loan-to-value ratio as of Monday’s calculations as of Monday’s calculations, with a higher loan-to-value ratio than the market, at a rate of 2.34%.
However, they said that the amount is very small compared to the remaining range freight of RMB 30 billion in 2025.
In a research note, JPMorgan said that given that Shenzhen Metro only has 30 billion yuan in cash, authorities will need to inject more funds into the Shenzhen-owned railway companies or ask other state-owned companies to obtain assets from Van Ke.
The broker said Vanke’s liquidity will also depend on its home sales.
“If Vanke’s sales are worse than expected, not only will it pay back the funds required for bonds, but the funds required for door-to-door delivery are also greater than expected, then Shenzhen Metro may consider whether it is possible to consider bond restructuring/ Is it possible that extension is a more pragmatic approach,” it wrote.
Vanke currently holds a 57% stake in Onewo. In the filing, it will use the proceeds from shareholder loans to pay off debts on the open market, it said.
Vanke’s shares rose 0.9% from noon Tuesday to noon Tuesday, while Shenzhen’s shares fell 1.5%. Onewo shares fell 1.1%.
($1 = 7.3085 Chinese RMB)
(Reported by Clare Jim; Edited by Muralikumar Anantharaman)
