Developer Skyfame enters liquidation after heavy borrowing

A Guangzhou-based property developer has become the second mainland firm in less than a month to enter winding-up proceedings after borrowing heavily from foreign banks and hedge funds at the height of the credit boom, the South China Morning Post reported. Hong Kong-listed Skyfame Realty, which owns Guangzhou's Westin hotel, owes US$196 million to convertible bondholders including Merrill Lynch and hedge funds Avenue Partners, DKR Oasis Capital Management and PMA Investment Advisers. Ernst & Young has been appointed as the developer's provisional liquidator, sources said. Skyfame agreed in September to sell properties worth US$350 million, including the Westin, to HNA Group, the state-owned enterprise that co-owns Hainan Airlines with US billionaire George Soros, but the deal has still not been signed.