Genting bond yield rises on Genting Hongkong cash crunch

SINGAPORE, Aug 20 (IFR)The yield on Genting Berhad’s US dollar bonds due 2027 briefly shot up 100bp to 4.89% this morning, after Genting Hongkong suspended all payments to financial creditors.

Malaysian conglomerate Genting Berhad’s bond yield came back to 4.36% by midday, according to Refinitiv data, but this was still 42bp wider on the day.

Cruise ship operator Genting Hongkong has suspended all payments to financial creditors as it works on restructuring its debt and raising funds.

It has hired PJT Partners as financial adviser and Kirkland & Ellis as legal adviser. It plans to convene a creditors’ meeting soon and encouraged creditors to form a steering committee.

Lim Kok Thay and family owned 75.5% of Genting Hongkong’s shares at the end of December, according to the company’s annual report. Lim is the chairman, CEO and substantial shareholder of Genting Berhad, as well as the chairman and CEO of Genting Hongkong.

In January, Genting Hongkong raised US$900m from the sale and leaseback of one of its cruise ships to a consortium of Bank of Communications Financial Leasing, CMB Financial Leasing, CCB Financial Leasing and China Development Bank Financial Leasing. It used the proceeds to repay an outstanding US$502m loan.

Genting Hongkong shares are down 36% today. It has no US dollar bonds.

(Reporting by Daniel Stanton; Editing by David Holland)

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