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A real estate developer from southern China with debts of more than $300 billion is threatened with liquidation. Creditors from abroad took the issue to court because the company had already delayed payments many times.
Chan had said in previous negotiations that this was the final reprieve and that China Evergrande would likely agree to liquidation if it could not find a restructuring plan with creditors. According to the information obtained, the lawyers of the company, which is traded on the Hong Kong stock exchange, announced that they could reach an agreement with creditors in the coming weeks.
With liquidation, the bankruptcy administrator can make money from the company and thus pay creditors. Some experts believe liquidation will return creditors less money than restructuring. According to the information obtained, China Evergrande also defended this in court.
The group wanted to present a restructuring plan from 2022, which has always failed. Chinese authorities are investigating Hui Ka Yan, the company’s founder and once China’s richest man.
Like many other real estate groups, the company has been in serious crisis for a long time because they are earning much less in a depressed real estate market, it is becoming harder to get government support and they can no longer serve their customers. loans. “The Evergrande case also shows that the era of large private real estate developers in China is coming to an end,” says Max Zenglein of the Merics China Institute in Berlin, Germany.
If Chan decides to liquidate Evergrande in the China case, it could affect other companies. “The challenge for the government will be to prevent the domino effects that major bankruptcies cause in the economy,” says Zenglein.
(SDA)
Source :Blick
I’m Tim David and I work as an author for 24 Instant News, covering the Market section. With a Bachelor’s Degree in Journalism, my mission is to provide accurate, timely and insightful news coverage that helps our readers stay informed about the latest trends in the market. My writing style is focused on making complex economic topics easy to understand for everyone.
