Embattled property developer Novaland Group plans to issue nearly 152 million shares to redeem over VND6 trillion (US$229 million) worth of bonds in a debt-equity swap.
It plans to seek shareholders’ approval of the plan at an upcoming extraordinary general meeting. It made 13 bond issuances between 2021 and 2023, all maturing between 2023 and this year.
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Palm City, an urban project developed by Novaland in Ho Chi Minh City. Photo courtesy of Novaland |
The company plans to issue over 151.85 million shares at VND40,000 per share, double the Wednesday closing price on the stock market.
“Due to challenging business conditions and prolonged financial pressures, the company has been unable to meet its debt repayment commitments,” a spokesperson said.
The management believes in the potential for recovery following the resolution of various legal obstacles faced by key projects in the second quarter and continued support from partners and financial institutions amid an improvement in the economy, they added.
The company said while the share issuance would lead to short-term dilution for existing shareholders it is a “necessary step” to restructure the company, alleviate cash flow pressures, enhance financial stability, and demonstrate goodwill in safeguarding stakeholder rights.
On approval from shareholders, Novaland will submit the plan to the State Securities Commission, and targets issuance in 2026.
The shares issued against the bonds will have a one-year lock-up period when they cannot be sold.
Novaland reported a net loss of VND666 billion in the first half of 2025.
It has outstanding loans of VND61.8 trillion, and said it lacks the capacity to fully repay them and is exploring new solutions it would implement in late 2026 and early 2027.
