The Limited Times

Now you can see non-English news...

Evergrande: Real estate giant from China wants to postpone payments by six months

2022-01-05T07:49:17.383Z


China's real estate giant Evergrande is again unable to pay due bond interest. In an online crisis conference, the group wants to inform the creditors about a later repayment and let them vote. But that's not the only bad news.


Enlarge image

And again nothing:

Evergrande wants to postpone the repayment of interest due soon

Photo: HECTOR RETAMAL / AFP

The construction company China Evergrande, which has got into financial difficulties, wants to postpone the payment date for payments due soon.

The proposed change in the repayment date from January 8th to July 8th was due to the financial situation, the group announced on Wednesday without further details.

Evergrande is inviting its creditors to an online meeting from January 7th to 10th, followed by a vote. In the run-up to the negotiations, bond trading will be suspended from January 6, said the Hengda Real Estate Group, the flagship of the Evergrande real estate division. The securities concerned are the Hengda 6.98 percent bond interest of 4.5 billion yuan (156.92 million dollars) with a term of January 2023 due this weekend.

Evergrande's shares, whose trading was suspended on Monday for no reason and resumed on Tuesday, fell around 1 percent on Wednesday.

The second largest real estate developer in China is struggling with a mountain of debt of more than 300 billion dollars and has already warned of possible defaults.

According to credit analyst Marco Metzler, the bankruptcy delay at Evergrande "has long since occurred".

Revenues collapsed, 39 buildings were forced to be demolished

On Tuesday it became known that the group on the island of Hainan in the tropical south of China had to demolish 39 buildings that were apparently illegally erected.

Investors, suppliers and home buyers want nothing more than that the group, which has already been considered insolvent by rating agencies, finally completes its numerous construction projects.

At the same time, Evergrande announced on Tuesday that, according to preliminary figures, sales had slumped by around 40 percent in the past year.

That should also have been the reason for the suspension of the shares from trading on Monday.

According to Bloomberg, this was the first ever decline in the past 10 years.

Evergrande is therefore likely to have practically not sold any properties since October.

"Evergrande, give us our money back!"

The real estate developer is currently unable to complete all of the houses and apartments that have been promised, nor to settle its debts.

China's entire real estate sector is in crisis.

Should heavyweight Evergrande go bankrupt, it could sweep the entire sector with it and ultimately bring the Chinese economy into distress.

Again and again there are demonstrations by hundreds of small Chinese investors who are demanding their money back from the staggering real estate colossus.

Last Tuesday, when they loudly vented their desperation in front of Evergrande offices in the southern Chinese city of Guangzhou, according to a report by the Reuters news agency: "Evergrande, give our money back!" They chanted.

rei / Reuters / AFP

Source: spiegel

All news articles on 2022-01-05

You may like

News/Politics 2024-01-29T03:18:16.286Z
News/Politics 2024-01-29T18:39:22.190Z

Trends 24h

News/Politics 2024-03-27T16:45:54.081Z

Latest

© Communities 2019 - Privacy

The information on this site is from external sources that are not under our control.
The inclusion of any links does not necessarily imply a recommendation or endorse the views expressed within them.