TheChek News Flow

Vanke’s Bid to Delay Bond Payment Sparks Selloff in Chinese Developers

The company is among the few major Chinese developers that have yet to default amid the country’s massive property bust

China Vanke’s 000002 -6.62%decrease; red down pointing triangle proposal to delay repayment of an onshore bond led to trading halts in three other local notes and triggered a selloff in shares of Chinese property developers, ratcheting up fears about the country’s drawn-out real estate crisis.

Vanke, one of China’s biggest real-estate companies, was once regarded as one of the country’s most solid developers. It is among the few major Chinese developers that have yet to default amid the country’s massive property bust.

In a filing late Wednesday, the company said it is seeking to delay payment of the principal on a two billion yuan ($282.5 million) medium-term note due Dec. 15.

The move sparked a broad selloff in the bond and equity markets. Some of Vanke’s onshore bonds dropped by more than 30%, triggering trading halts in Shenzhen. Chinese real-estate stocks fell sharply in Hong Kong, with the Hang Seng Mainland Properties Index, a gauge of developers listed in the city, dropping as much as 2.1% in early trading Thursday.

Shares of China Vanke slid as much as 8.5% in Hong Kong, hitting a record low before paring the losses to 4.4% by midday. Shimao Group led the decline among other property stocks, dropping 4.8%. Longfor Group fell 2.1% and Agile Group shed 1.3%. The benchmark Hang Seng Index rose 0.3%.

Vanke’s surprise request to delay repayment on local debt highlights the continuing cash-flow uncertainties facing Chinese developers and has spurred more questions about the continued spread of the real-estate downturn. China’s property sector, once a driver of the country’s economic growth, has been in a yearslong slump, with many major property developers suffering liquidity crises and defaulting on their debts.

“Vanke’s proposed delay in repayment reflects the firm’s lingering liquidity crunch, which weighs heavily on its debt-servicing capabilities,” Morningstar analyst Jeff Zhang said.

The developer, a top property pick among many analysts, been getting support from state-owned Shenzhen Metro Group amid the sector crisis. About one-third of Vanke’s shares are held by the rail operator. In early November, Vanke said it could borrow up to 22 billion yuan from Shenzhen Metro before June 30, 2026, with 2.29 billion yuan still available for withdrawal.

The linchpin is the negotiation with bondholders, who will likely require higher interest rates and additional pledges for the extension, Zhang said.

“If the negotiation falls through, we foresee significant deterioration in investors’ sentiment on China property sector, as Vanke is expected to remain safe from defaults,” Zhang said.

That said, Zhang thinks China’s central and local governments would aim to contain the spillover effects of Vanke’s troubles, so they may intervene by facilitating the agreement with major creditors.

Earlier this month, S&P Global Ratings downgraded China Vanke’s credit rating further into junk territory, to CCC from B-minus, saying the company’s financial commitments appear to be unsustainable.

The ratings company in its report said Vanke’s contracted sales between January and October have shrunk by about 43% from a year earlier, weaker than its previous expectation of a 40% drop for the full year. In 2026, it estimated that the company’s contracted sales could slip further to 103 billion yuan.

“China Vanke could default on its debt obligations if it does not receive timely and sufficient loans from its largest shareholder, Shenzhen Metro,” S&P Global Ratings said.

Heating up

EU member states are working to co-ordinate on a potential path for peace in Ukraine, but the debate around using Russia’s frozen assets has become increasingly fractious.

Context: The European Commission has proposed issuing a €140bn “reparations loan” to Kyiv based on immobilised Russian central bank assets. US President Donald Trump’s push for a peace in Ukraine without initially consulting his European counterparts has upped the pressure on agreeing the loan.

At yesterday’s virtual meeting of foreign ministers, EU chief diplomat Kaja Kallas and others forcefully called for the initiative to be expedited, according to officials.

But Belgium, where the majority of the assets are located and which has to date opposed such a loan, reacted defensively.

Belgium’s foreign minister Maxime Prévot warned that the scheme would be “adventurous and dangerous”, according to four people briefed on his remarks. He also said that his government wanted to pursue a different proposal made by the commission to instead issue joint debt to support Kyiv.

In a parallel meeting of EU ambassadors, Belgium’s representative endorsed the commission preparing both a legal proposal for joint debt, and for the reparations loan, according to two people briefed on those discussions.

A spokesperson for Prévot denied that there was inconsistency between the positions. “The position defended by minister Prévot today does not represent a change. As we stated as soon as the options were put on the table, the position being defended is . . . that of a loan by the European Union on the markets,” the spokesperson said.

Euroclear, the Brussels-based central securities depository which holds most of the assets, shares the Belgian government’s concerns that it would be on the hook for any legal or financial risks from the loan.

In a letter to commission president Ursula von der Leyen and EU Council president António Costa, seen by the Financial Times, Euroclear CEO Valérie Urbain writes that the scheme is “without legal precedent in the European Union and international law, and could be seen as de facto confiscation”.

Urbain warned that Russian retaliation could lead to financial exposure of member states — raising similar issues to joint debt, which countries like Germany oppose because of the strain on budgets.

As a December meeting of EU leaders approaches, officials are growing impatient. “We have to fix this financing stuff to keep Ukraine afloat . . . it’s time to stop talking and start doing,” said one senior EU diplomat.

Alibaba and ByteDance shift development to south-east Asia to sidestep US curbs

Top Chinese companies are training their artificial intelligence models overseas to access Nvidia’s chips and bypass US efforts to prevent their development of the powerful technology.

Alibaba and ByteDance are among the tech groups training their latest large language models in data centres across south-east Asia, according to two people with direct knowledge of the matter.

These people said there had been a steady increase in training in offshore locations after the Trump administration moved in April to restrict sales of the H20, Nvidia’s China-only semiconductors.

“It’s an obvious choice to come here,” said one Singapore-based data centre operator. “You need the best chips to train the most cutting-edge models and it’s all legally compliant.”

Over the past year, Alibaba’s Qwen and ByteDance’s Doubao models have become among the top-performing LLMs worldwide. Qwen has also become widely adopted outside China by developers as it is a freely available “open” model.

Data centre clusters have boomed in Singapore and Malaysia, fuelled by Chinese demand. Many of these data centres are equipped with high-end Nvidia products, similar to those used by US Big Tech groups to train LLMs.

According to those familiar with the practice, Chinese companies typically sign a lease agreement to use overseas data centres owned and operated by non-Chinese entities. This is compliant with US export controls as the Biden-era “diffusion rule” designed to close this loophole was scrapped by US President Donald Trump earlier this year.

One exception is DeepSeek, maker of high-quality and low-cost AI models, which is being trained domestically, according to people with knowledge of the matter.

The company built up a sizeable cluster of Nvidia chips before the US export bans took effect, according to people familiar with the matter.

It is also working closely with domestic chipmakers led by Huawei, to optimise and develop the next generation of Chinese AI chips, according to those people.

Huawei has a team of engineers stationed at DeepSeek’s Hangzhou headquarters. The company views its partnership with DeepSeek as a strategic effort to advance its semiconductor and software systems to be adopted for AI training across the country.

Training of LLMs requires a huge amount of computing power to process massive datasets, leading most Chinese groups to prefer Nvidia’s advanced products for the task.

These companies are, however, increasingly turning to locally made Chinese chips for “inference”, when AI systems respond to a user’s request and which accounts for an increasing share of overall AI workloads.

Beyond training, Chinese tech companies also use south-east Asian data centres to service their overseas customers, as Alibaba and ByteDance seek to grow their share of the global cloud computing market. Chinese companies are also expanding access to data centres in other regions such as the Middle East.

One constraint is that Chinese tech giants are not allowed to move private data out of the country. This means that to customise an AI model based on specific data supplied by a local client, training needs to remain in China, according to the industry insiders.

Alibaba, ByteDance, DeepSeek and Huawei did not respond to requests for comments. Nvidia declined to comment.

Donald Trump’s fixer-in-law: Jared Kushner returns to push Russia-Ukraine deal

The US president has put a trusted family man at the centre of his mission to end the Kremlin’s war

Stuck in a drab Geneva conference room discussing painful compromises to end a war, Ukrainian officials last Sunday could not help but notice the US delegate furiously tapping away at his laptop.

“I was kind of surprised to see Jared [Kushner] at first . . . but then I appreciated his mood,” said Sergiy Kyslytsya, one of the Ukrainian ministers in the room. This was Donald Trump’s son-in-law, his unofficial envoy and general foreign policy fixer — and he was busy taking notes about Ukraine.

Kushner, who married the president’s daughter Ivanka Trump in 2009, has long carried the weight of some of his father-in-law’s most impossible diplomatic missions.

During Trump’s first term, Kushner led the president’s push for Arab states to normalise ties with Israel. More recently he was called on to help broker a deal between Israel and Hamas in Gaza. Now his task is to silence the guns and drones on the front lines in the Donbas. Kushner did not respond to a request for an interview for this article.

Kushner’s entry into one of the thorniest diplomatic manoeuvres of Trump’s second term — an effort to end Russia’s brutal land war in Ukraine — is part of the president’s plan to replicate the breakthrough in Gaza.

There, a 20-point plan bearing the US president’s name led to a fragile peace between Israel and Hamas and the release of remaining Israeli hostages.

After that deal, Steve Witkoff, Trump’s special envoy, and Kushner, turned to Ukraine. The double act went to work behind the scenes, producing an initial draft text that Kyiv’s European allies feared was so close to Russia’s demands that it amounted to capitulation.

Next week, the diplomatic duo may fly to see Vladimir Putin in the hopes of “finalising” the peace plan, Trump said on Tuesday.

It will be Witkoff’s first meeting with Russia’s leader in the Kremlin with another Trump envoy by his side.

Trump said: “Steve Witkoff is going over maybe with Jared. I’m not sure about Jared going, but he’s involved in the process, smart guy, and they’re going to be meeting with President Putin.”

Despite his scant background in the region, Kushner’s involvement is “on balance, a good thing”, said Philip Gordon, who served as national security adviser to former vice-president Kamala Harris. “Like Witkoff, he clearly has the trust and confidence of the president, which is a requirement of any successful negotiator.”

“Unlike Witkoff, he has experience with diplomacy,” Gordon added.

Kushner’s turn as a peacemaker this year has been unexpected. When Trump returned to the White House, his son-in-law — who served as an adviser in the president’s first term — insisted he would steer clear of government.

Kushner said his main focus was on his private equity start-up Affinity Partners, which he incorporated the day after Trump left office in 2021. Six months later, he secured a $2bn investment from Saudi Arabia’s sovereign wealth fund.

The fund has been the subject of a Democrat-led Congressional investigation seeking to probe any overlap between Kushner’s business dealings and his time in government. Kushner has dismissed the investigations as politically motivated.

“My main focus is on Affinity so I no longer envision taking an active role in those discussions,” he told Financial Times in January when asked about the administration’s efforts to expand Trump’s Abraham accords, which established diplomatic ties between Israel and four Arab states.

“I do think I could be helpful to Steve so I am here to give advice, if needed,” he said.

Kushner and Witkoff, a longtime friend and golfing partner of the president, are a generation apart but close, said a US official familiar with their dynamic. Witkoff in February said the president’s son-in-law had “convinced” him to take the job as Trump’s envoy. The pair would often call each other to bounce ideas around, a person familiar with them said.

The president trusts his son-in-law’s diplomatic nous.

“We always bring Jared when we want to get that deal closed,” Trump said in a speech to the Israeli parliament in October, as Kushner watched from a balcony. “We need that brain on occasion.”

The Kushner playbook in Gaza is the Trump administration’s model for its peace efforts in Ukraine.

There were “more differences than similarities” between the Gaza and Ukraine conflict, said Gordon. Nonetheless, he said: “I think their takeaway was, you put something on paper and say ‘all right guys, this is Trump’s plan, now let’s get serious, you’re taking it’, and it works.”

A leaked transcript of a call last month — days after the Gaza deal — between Witkoff and Putin’s top foreign policy aide Yuri Ushakov laid bare the administration’s attempts to replicate the approach in Gaza.

“Maybe we set out like a 20-point peace proposal, just like we did in Gaza,” Witkoff said, according to the transcript Bloomberg published. The FT has not verified the transcript.

Kushner was brought in to help draft the next collection of bullet points.

“He’s very good at this, he’s very good at putting pen to paper,” said the US official.

He and Witkoff had input from Russian officials including Kirill Dmitriev, the chief executive of Russia’s sovereign wealth fund — a fact that has raised some alarm in European capitals.

A graduate of the Harvard Business School, Dmitriev’s connection with the president’s son-in-law stretches back to Trump’s first administration. The men first met in Montreux in 2019, on the shores of Lake Geneva, to talk big-picture diplomacy in the Middle East.

The approach to the latest peace plan has raised some concerns about how Trump — not for the first time — is entrusting the gravest matters of geopolitics to a trusted coterie, including family.

“There’s no formal policy co-ordination mechanism alive anymore,” said a former US defence official. “It really comes down to policy by personality.”

Obesity medications are diminishing appetites for the foods that American holidays are known for

Thanksgiving is a festival of overabundance. That’s the whole point of it. But the whole point of weight-loss drugs — the most prescribed medications by value in the US today — is to eat less. Medical experts say that fact is changing Americans’ relationship to food — and to the festivals that focus on it.

More and more Americans are tackling obesity through drugs. KFF, the health policy group, found recently that one in eight now say they are taking GLP-1 drugs like Wegovy or Ozempic. 

Meanwhile, public awareness of these drugs is exploding: PwC recently found that consumer interest in Ozempic had risen faster than curiosity about iPhones, Facebook or Uber at comparable points in their development. And President Donald Trump’s deal earlier this month to lower prices for what he calls “the fat shot” will provide access for 15mn more Americans, according to Morgan Stanley. 

One recent study found that households with at least one GLP-1 user cut savoury snack spending by over 10 per cent in the first six months. “It’s the most significant shift in the food system in the last 100 years,” says Justin Siegel, faculty director of the Innovation Institute for Food and Health at University of California Davis. “And it’s beginning to impact culture.”

Medical experts say GLP-1s (glucagon-like peptide-1), which were developed to address diabetes, help people to eat less by slowing down gastric emptying — so you feel full for longer. They also affect the “reward” system our brains associate with food: patients often report less craving for fatty or sweet foods — exactly the kind in pride of place on our holiday tables.

That can have big implications for Thanksgiving when “eating too much is part of the ritual”, says Charlotte Biltekoff, professor of American studies and food science and technology at UC Davis. Daniel Bessesen, endocrinologist at the University of Colorado, says his patients on GLP-1s “just can’t eat the way they did in the past”. “If they did, they would get sick.” 

Jens Juul Holst, a Danish researcher known for his pioneering work on GLP-1s, says: “If you’re a person for whom nice meals are one of the greatest pleasures in life, and you take that away, then it’s perhaps not so fun.” That, along with common gastrointestinal side effects, “help explain why quite a large number of people stop taking the medications”, he tells me.

But Siegel’s father Brock, 78, is taking the drugs and says he doesn’t feel deprived. Ahead of previous Thanksgivings, he would “look forward to relishing the food knowing I was going to overeat”. This year, he says, “I’m going to enjoy all the flavours but automatically not take as much. It’s very freeing.” 

Bessesen suggests food-centred holidays may be more fun for those on GLP-1s. “For some people, holidays are not pleasurable, because there is food around all the time and lots of pressure to eat. So to have less of that is really positive for some people.” 

I heard this from a number of people who take the medication (but prefer not to give their full names). Spencer, 35, a West Coast tech entrepreneur, says he’s not suffering: “I’ve been to a Michelin-star restaurant on GLP-1s — and it’s still a wonderful experience,” he tells me. “Now I don’t have to spend willpower on cookies but can spend it on my family and career.”

Ashley, 33, says that for her it has reduced “food noise”. “I would always be wondering, ‘What do I want for lunch? What can I snack on?’ Now I eat maybe a third and I’m full . . . I’m going into this holiday feeling more confident.”

But Thanksgiving is not just about eating — it’s also about being seen to eat. Spencer says there is still a stigma involved: he’s been accused of “cheating” by using medicine to address his weight. Social media is full of advice on how to hide your weight-loss injection pens from visitors. 

Still, Spencer is looking forward to Thanksgiving: “I am going to try lots of great things, but I won’t come back and be up five pounds,” he says. Shame there’s no drug to counteract Black Friday shopping overindulgence as well.

Leonardo to unveil ‘Michelangelo Dome’ air shield system

Italian defence group to show AI system that will connect equipment and platforms to protect nations from air threats

Italy’s Leonardo is set to unveil a new type of air-defence technology designed to facilitate the creation of Dome-style missile shields, as European countries race to strengthen their military protection against Russia.

Chief executive Roberto Cingolani on Thursday will present advanced plans for its “Michelangelo Dome”, an artificial intelligence-based system that can connect different equipment and platforms to protect countries from air threats in a similar way to Israel’s Iron Dome.

People familiar with Leonardo’s plans, unveiled to top Italian army officials earlier this week, said the system was based on software which was not linked to a single military platform so any country could use it for its own existing vehicles, structures and systems.

“It’s based on the Nato standard, where we don’t all have the same platforms,” said one person. “This will allow for faster and more co-ordinated implementation without focusing on competing aircraft, tanks and missiles.”

The Italian defence champion’s move, trailed by Cingolani in July, comes as European countries try to respond to Russian aggression by developing better air and missile capabilities.

Three years ago, Germany unveiled a European Sky Shield Initiative that would include countries jointly procuring equipment to ensure better interoperability and standardised defence platforms. The project blindsided French officials and was criticised for relying too heavily on weapon systems manufactured outside the continent.

More than 20 nations have since signed up to Sky Shield, including the UK, the Baltic states, Sweden and Finland.

Although countries make their own procurement decisions, Germany has said it plans to buy Iris-T missiles from homegrown manufacturer Diehl Group for medium-range protection, the Patriot from US-based Raytheon Technologies for long range and the Arrow 3 from Israel for very long range.

Leonardo’s dome project is built on the contractor’s strategy over the past three years, creating a space division, focusing on drones as well as AI and cyber technology.

Cingolani described the dome project as “the largest integration programme ever in the defence industry” at its earnings presentation earlier this month, enabling a quick response to potential attacks.

The “multi-domain, interconnected AI-driven system” was at an advanced stage, with the company running trials on neutralising airspace attacks, said people familiar with the project. Its system should become fully operational by the end of the decade, they said.

“The aim is for all platforms to communicate and be interchangeable,” said one of the people.

Leonardo declined to comment.

Will Drahi end the creditor-on-creditor violence era?

Top money managers Apollo, Ares, BlackRock and Oaktree have been called many things over the years. But “illegal cartel” might be a new one. 

The accusation was levied by Altice USA, the troubled telco led by Patrick Drahi, in a lawsuit filed on Tuesday. Altice USA alleges that its creditors violated US antitrust laws by colluding in an attempt to force the company into bankruptcy.

The suit centres on a document known as a co-operation agreement (read: NON-co-operation agreement), which stipulated no creditor could cut a deal with Drahi without permission from the group. The holders of nearly every dollar of Altice USA’s $26bn debt stack signed it.

DD has long covered the distressed debt wars and their legal machinations but a competition claim is novel (the FT scooped last month a similar claim involving Selecta, the Swiss vending machine company). 

Experts are divided on whether antitrust law can be successful in resolving what are typically contract or securities law disputes. 

At DD we find it humorous that a dispute involving the likes of Drahi, Kirkland & Ellis, PJT Partners and Apollo has anyone claiming the moral and legal high ground or displaying righteous indignation. 

A senior person at one of the boldfaced vulture funds in the co-operation group cheekily sent an FT reporter Tuesday night the long profile of Drahi published in The New Yorker over the summer, intimating that maybe the tycoon was the roughest character in this tussle.

Perhaps this will be the moment the distressed debt battlefield tilts back to hedge funds after years of brutal “creditor-on-creditor violence” losses.

DD will follow this latest drama if for no other reason than to track the bruised egos and low-grade epithets.