(Bloomberg) -- Country Garden Holdings Co. canceled a HK$2.34 billion ($300 million) stock offering in the latest setback for one of China's largest private-sector developers, a person with knowledge of the matter said.
The share placement arranged by JPMorgan Chase & Co. had attracted enough investor orders to go forward, according to the person. Country Garden was offering 1.8 billion shares at a fixed price of HK$1.30 apiece, the person said, asking not to be identified as the information isn't public. The price represented a 17.7% discount to Monday's close.
IFR reported the cancellation earlier on Tuesday, citing a message to investors. A representative for JPMorgan declined to comment, while Country Garden didn't immediately offer comment.
Country Garden warned Monday it expects a net loss in the first half due to declining gross profit margins and impairment provisions. Once considered a safer investment among developers, the company has become a proxy for financial contagion in an industry that accounts for about a quarter of the country's gross domestic product.
The developer faces $2.9 billion in debt payments for the rest of the year, with its liquidity woes testing its ability to meet deadlines and avoid a first-ever default. Worries that Country Garden may miss payments have sent its bonds tumbling in recent weeks.
JPMorgan recently downgraded Country Garden's stock as liquidity concerns surrounding China's private builders are unlikely to ease anytime soon.
(Updates throughout with confirmation.)
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