KWG Group has missed a $119mn payment on its 6% dollar bonds due January 2024. The developer noted that it missed the payment that included 15% of the principal, and the accrued/unpaid interest, due May 14. KWG has not yet received any acceleration notice from creditors regarding the missed payments. KWG is currently searching for a financial adviser to explore solutions. The notes have a 30-day grace period before the failure of payment constitutes a default and they are relying on internal cash resources and remitting cash from onshore to meet offshore payments. Its dollar bonds have been under pressure ever since the developer defaulted on its RMB 212mn ($31mn) local bond principal payment earlier this month.
KWG’s dollar bonds have already been trading in distressed territory and are trading deeper into distress at ~12 cents on the dollar.