(Yicai Global) July 13 -- Sunac China Holdings Ltd. [HKG:01918] has come into the spotlight after acquiring a number of Dalian Wanda Commercial Properties Co.'s hotels and theme parks, but the deal has raised credit rating concerns.
Standard and Poor's Financial Services LLC put Sunac China's B+ long-term enterprise credit rating and cnBB- long-term Greater China rating on credit watch on July 11.
Sunac's financial leverage may worsen after its large-scale land acquisition and expansion outside of its core business areas, S&P said. S&P had previously forecast that Sunac's robust sales growth and land acquisition would help it improve its leverage.
The company's financing channels were recently narrowed. Issuance of Sunac's USD1.5 billion (CNY10 billion) corporate bond was stopped by the Shanghai Stock Exchange last month, per the SSE's official website. The bond's underwriter and manager were China Securities Co. and Guotai Junan Securities Co. [SHA:601211], respectively.
On July 10, Sunac signed a framework agreement with Dalian Wanda Commercial Properties, a unit of Dalian Wanda Group, under which Sunac will acquire 91 percent equity in 13 cultural and tourism project companies and 100 percent equity in 76 hotels for CNY63.17 billion.