SUNAC denies media report on financing suspension

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Sunac China Holdings Ltd, a Hong Kong-listed property developer, denied a Bloomberg report that claimed suspension of firm's financing by a state-owned lender, according to a statement Sunac released on its website on Wednesday.

China Huarong Asset Management Co., a state-owned entity whose businesses include lending, asked units to temporarily suspend new project financing to Sunac China Holdings Ltd, Bloomberg reported Tuesday, citing an Internal email.

Sunac denied the report and said, they are maintaining close cooperation and communication with China Huarong Asset Management Co Ltd to resolve the confusion.

Huarong said it’s not acting on instruction from regulators, but regulators have noticed Sunac's high debt load and aggressive acquisition strategy, Bloomberg reported.

Sunac argued that it has confirmed with Huarong that they have never received any requests or notices from regulators about Sunnac.

“The attention paid to Sunac was Huarong’s normal client management behavior. Huarong didn’t cease business cooperation with Sunac, and under the precondition of risks being controllable, Huarong will continue to maintain its cooperation with Sunac,” the statement said.

Sunac has been under the spotlight due to its purchasing spree in past several years. It bought Dalian Wanda Group’s hotels and tourism assets with 6.5 billion US dollars as well as cash-strapped Leshi Internet with 2.2 billion US dollars this year.

In the last one year, Sunac has spent more than 135.5 billion yuan in the acquisition, according to data compiled by The Beijing News based on earnings reports and public announcements.

The developer has claimed to lower its net debt ratio to 90 percent by the end of 2018 and 70 percent in 2019, from 200 percent in 2017; the company said at a briefing after the first half-year earnings report filed to Hong Kong Exchange on August 31.