, Columnist
Country Garden, Where a Bond Default Would Make Sense
Better to take the pain and keep the business going, or there won’t be an asset recovery worth speaking of.
There’s no future without a default and restructuring.
Photographer: Qilai Shen/BloombergThis article is for subscribers only.
Default is a taboo most companies are keen to avoid. But sometimes, business operations demand it. Even the bond investors don’t mind.
Country Garden Holdings Co., once China’s biggest real-estate developer by sales, is walking a tightrope. A scrapped share placement last week fueled concerns whether the company has enough money to repay its dollar bonds in the next year, even as ratings agency Moody’s Investors Service says it does. In this case, though, a default would make more sense.