New World Development halts trading, mulls up to HK$25bn rights issue
New World Development suspended trading of its shares and debt securities on 13 November, ahead of a possible rights issue of up to HK$25 billion to strengthen its balance sheet and address debt maturities, according to Bloomberg. The developer, Hong Kong's most indebted property firm, has been cutt
New World Development (NWD) halted trading of its shares and debt securities at 9 am on Friday 13 November, before the market opened, and said it would consider a rights issue of up to HK$25 billion, Bloomberg reported. The company said it is pending an announcement of inside information.
The market has recently focused on NWD's capital restructuring efforts, including a potential rights issue, which Bloomberg reported it has engaged banks to prepare to raise up to HK$25 billion to strengthen its balance sheet and address debt maturities. Banks are considering arranging the share offering on a soft underwriting basis — that is, trying to find external investors rather than committing to buy any unsold shares with their own funds. The discussions are still ongoing, and the rights issue plan may not proceed, according to people familiar with the matter.
Last month, reports indicated that private equity firm Bain Capital was exploring a capital injection into NWD, with the plan also involving new funds from the Cheng family. Blackstone had also previously considered a capital injection plan, but it was reportedly dropped because the Cheng family refused to give up its controlling stake.
The Hong Kong property developer, the most heavily indebted among its local peers, has been trying to cut debt, dispose of assets and bolster liquidity amid tight credit conditions and a weak property market. NWD chief executive Echo Huang told an earnings conference in October that she expected the company's cash flow would improve significantly in the first half of fiscal 2026/27.
In a bond exchange offer last month, New World issued around US$189 million (HK$1.47 billion) in new secured notes due in 2032 to swap for some notes due in 2027 and 2028.
