China Builder Wuzhou's Bonds Fall to Record Low Amid Share Halt

Wuzhou International Holdings Ltd. bonds slid to a record low as the builder of malls in China halted trading of its stock following an unprecedented plunge in the shares Monday.

The developer’s 13.75 percent notes due in 2018 dropped 3.6 cents on the dollar to 94.2 cents as of 10:32 a.m. in Hong Kong, the lowest since issuance in 2013, according to data compiled by Bloomberg. The company halted trading pending an announcement in relation to certain share transfers by controlling holders, it said in a filing Tuesday. Its stock plunged 32 percent in Hong Kong on Monday, the steepest decline on record.

Wuzhou’s shareholders include Boom Win Holdings Ltd., which has a 69.7 percent stake in the developer, the data show. Wuzhou Chairman Shu Cecheng owns 60 percent of Boom Win and Chief Executive Officer Shu Cewan holds 40 percent, according to a company interim report filed to the Hong Kong stock exchange in September.

“The share transfer is among family members,” Chairman Shu said when reached by phone Tuesday. “I believe this is normal.”

Zhu Quanfeng, Wuzhou’s head of public relations based in the eastern Chinese city of Wuxi, declined to comment immediately, adding that the company will release another statement later Tuesday. Two calls to Ronnie Cheung, chief financial officer of Wuzhou, went unanswered.

More than 119 million shares of Wuzhou changed hands on Monday, the highest volume since June, with most of the price drop coming in the final 30 minutes of trading. The stock closed at 70 Hong Kong cents, its lowest price since the developer’s 2013 initial public offering.

“Our concern now revolves around their ability to access onshore bond markets to ameliorate the refinancing risk,” said Charles Macgregor, the Singapore-based head of Asian high-yield research at Lucror Analytics.

— With assistance by Moxy Ying, Lianting Tu, and Emma Dong

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