PROPERTY developer Sunac China could this week decide whether to go ahead with a takeover of Shenzhen-based Kaisa Group after halting talks on restructuring its troubled peer’s US$2.5 billion debt, a credit analyst said Tuesday, citing an unnamed Sunac official.

    Sunac’s shares have been suspended since May 15, pending an announcement related to Kaisa.

    Singapore-based Lucror Analytics said Sunac had halted the debt talks due to delays by Kaisa in finalizing its 2014 annual results. Kaisa’s shares have been halted since end-March pending this announcement.

    Sunac has made the restructuring of Kaisa’s debts a key condition of its takeover proposal and has set a July 31 deadline for a deal. Sunac had offered in February to buy two Kaisa units for US$385 million and acquired a 49.25 percent stake in the company for US$587 million, giving a financial lifeline to the developer that was about to become the first Chinese firm to default on an offshore bond.

    Prospects for the deal, however, have dimmed since the Chinese authorities lifted a sales block on key Kaisa projects and the company reinstated Kwok Ying-shing as its chairman after he had left in the midst of its debt crisis in December.

    Kaisa’s bondholders have also opposed some of the terms of deal but Sunac has already sweetened its offer, people with knowledge of the matter said.

    Chinese online media portal Jiemian, however, said Monday Sunac was considering pulling out of the deal after Kaisa’s Kwok told the Hong Kong stock exchange that some aspects of the takeover contravened exchange rules. (SD-Agencies)