International investors in Kaisa are in talks to buy up to $1bn of the Chinese property developer’s distressed loans from mainland banks.
The bondholders hope that by buying the mainland debt they will be granted a closer look a the developer’s restructuring plans.
The developer, which is the sector’s second-biggest offshore bond issuer behind Evergrande, failed to repay a $400m bond that matured last week.
The two companies were declared in official default by rating agency Fitch last Thursday.
The attempt to buy non-performing loans from mainland banks is being arranged through a bondholder group negotiating with Kaisa in connection with almost half of its $12bn offshore debt, people familiar with the matter said.
“The overall objective is to ensure we have better co-ordination between onshore and offshore restructuring,” said a bondholder involved in the plans.
“Currently as an offshore creditor, you tend to be subordinated, you don’t have a lot of insights into what is happening onshore.”
