Sunac China Holdings has secured court approval to convert its US$9.6 billion in offshore bonds into equity, paving the way for the embattled property developer to eliminate all its debts upon completion of the restructuring.

The High Court of Hong Kong has sanctioned the offshore debt restructuring scheme, and the sanction order has been delivered for registration, the Tianjin-based company said in a statement on Tuesday.

First proposed in April, the restructuring plan involves the issuance of two mandatory convertible bonds, allowing offshore creditors to exchange their debt holdings for Sunac shares. The plan gained strong investor support, with approval rates rising from 75% in June to 98.5% by October.