CIFI Holdings

Houlihan Lokey is pleased to announce the successful restructuring of c. $8.1 billion of offshore indebtedness issued by CIFI Holdings (Group) Co. Ltd. (CIFI). The transaction represents a holistic restructuring of the company’s offshore capital structure, resulting in balance sheet deleveraging of c. $5.4 billion and weighted average maturity extension of approximately five years. Houlihan Lokey acted as the exclusive financial advisor to an ad hoc group of offshore noteholders (the AHG), leading the structuring and negotiation of the transaction on their behalf.

Headquartered in Shanghai, China, CIFI (HKSE:0884) is one of the top property developers in China by contracted sales. The company invests in, develops, and manages properties in China and overseas, with a focus on first- and second-tier cities as well as core cities in China.

Since the second half of 2021, the Chinese property sector has experienced considerable disruption due to stricter regulations on pre-sale funds, restricted access to both onshore and offshore financing, and a sharp decline in contracted sales. These challenges were compounded by macroeconomic headwinds and a prolonged slump in capital markets, which pressured CIFI’s liquidity and constrained its capacity to refinance maturing debts. In response, the company initially pursued individual liability management exercises with selected offshore creditors but subsequently pivoted to a holistic offshore restructuring in November 2022.

Houlihan Lokey was retained by the AHG in November 2022 to evaluate restructuring alternatives and engage in negotiations with CIFI as well as a coordinating committee of offshore bank lenders. Following months of diligence and negotiations, a restructuring plan was agreed that provides CIFI with material deleveraging and maturity extensions, while also offering creditors the potential to participate in future upside through equity-linked instruments. The transaction was implemented through a scheme of arrangement in Hong Kong and became effective on December 29, 2025.

Key terms of the restructuring plan included:

• Options for creditors to elect:
  
  
  • Option 1: Short-term debt with a zero coupon and a maturity of 2 + 1 years upon the company’s election.
    
    
  • Option 2: A combination of upfront cash and mandatory convertible bond (MCB) or a combination of upfront cash, MCB, and midterm debt with a coupon of 2.75% and a maturity of 4.5 years.
    
    
  • Option 3: Long-term debt with coupons of 1.0%–1.25% and a maturity of 6+ months up to three years upon certain conditions.
    
    
• Credit enhancement package comprising charges over offshore and onshore secured accounts as well as an intercompany claim, and a cash sweep over two offshore projects, Ever Sunshine shares, four WFOE-held projects, and 15 onshore projects.
  
  

Based on the creditors’ election, approximately $4.1 billion MCBs will be issued upon the restructuring effective date, representing c. 57% of the company’s common equity post full MCB conversion (at the lower fixed conversion price). The company’s largest shareholders will retain a stake of c. 27% as a result of shareholder loan equitization and a management incentive plan.

The transaction helps CIFI achieve significant debt reduction offshore, de-risk operations to stabilize its business, and pursue long-term value creation. At the same time, it aligns the interests of stakeholders by providing creditors with optionality to benefit from potential equity upside as the company normalizes operations.

RELATED: Real Estate, Lodging & Leisure, Financial Restructuring