Tag: Bankruptcies

What Evergrande’s Collapse Might Mean for the Global Economy

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What next for Evergrande’s creditors? A Hong Kong court on Monday ordered the liquidation of Evergrande, the heavily indebted Chinese property giant. The decision comes two years after the company defaulted, setting off a financial crisis at other developers and adding to the challenges facing the world’s second-largest economy. The company’s dissolution raises questions about fairness for overseas creditors — which could have wider implications for foreign businesses operating in China. How Evergrande fell: The company was once deemed too big to fail, racking up debt to expand during a…

China Evergrande Must Be Liquidated, a Judge Said. What Happens Next?

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After nearly two years of false starts, last-ditch proposals and pleas for more time, China Evergrande, a massive property company, has been ordered to dismantle itself. It’s a big moment. Evergrande’s collapse in 2021 sent China’s housing market into a tailspin. The worries in real estate, where most households put their savings, helped tip the economy into a downturn. The scale of Evergrande’s empire is enormous: Its developments cover hundreds of cities. It controls dozens of business and is more than $300 billion in debt — a sum far greater…

Country Garden Says Executives Have Not Fled China

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Facing a potential financial collapse, the embattled Chinese property developer Country Garden on Thursday denied rumors that its two most prominent executives had fled China. Country Garden took the unusual step of issuing a statement on its WeChat social media account declaring that Yang Guoqiang, the company’s founder, and his daughter Yang Huiyan, its chairwoman and majority shareholder, were “currently working normally in China.” It said rumors that the two had left the country were having “an adverse impact” during “a difficult period” for the company. The statement, issued on…

China Evergrande, Giant Developer, Files for Bankruptcy

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China Evergrande, a behemoth property developer, filed for bankruptcy protection on Thursday more than two years after it defaulted on its debt. The company’s meltdown in 2021 was followed by the defaults of smaller developers and signaled the start of a slow decay of China’s real estate sector that now threatens to inflict damage on the country’s broader economy. Another giant developer, Country Garden, is staring down a default of its own after missing payments to lenders and holding $200 billion in unpaid bills. Evergrande’s bankruptcy petition, filed in the…

China Evergrande Makes Payment to Dodge Default, Media Says

Chin@Strategy

HONG KONG — China Evergrande, the troubled property giant that is teetering on the edge of collapse, appears to have bought itself a little more time. On Friday, the world’s most indebted property developer made an $83.5 million interest payment to bondholders, according to Securities Times, an official newspaper. The outlet, which is backed by People’s Daily, the Communist Party’s official newspaper, didn’t offer further details. The payment came with just one day left on a 30-day grace period to avoid a default. The company gripped global financial markets a…

What Would an Evergrande Default Look Like?

Chin@Strategy

Shares of China Evergrande, the troubled real estate giant whose fate has contributed to jitters in global markets, fell again on Tuesday amid a new prediction that it would soon default. The company’s chairman, Xu Jiayin, told employees in a letter quoted in Chinese media that Evergrande would surmount its problems, which include $300 billion in debt, plunging sales of apartments and a payment due Thursday. “I firmly believe that Evergrande will walk out of its darkest moment and resume full-speed work and production,” he said in the letter, which…

China Evergrande Warns of Financial Pressure, Hires Advisers

Chin@Strategy

China Evergrande, the troubled property giant that has become a symbol of debt and excess in the world’s second-largest economy, said on Tuesday that it faced “tremendous” financial pressure and had hired restructuring experts to “explore all feasible solutions” for its future. The company’s fate, however, remains unclear, as it struggles in a country where business troubles often attract the direct attention — and the direct meddling — of Beijing. Evergrande’s admission that its finances have taken a sharp turn sent its already battered shares down by 12 percent on…

Why Evergrande’s Debt Problems Threaten China

Chin@Strategy

Every once in a while a company grows so big and messy that governments fear what would happen to the broader economy if it were to fail. In China, Evergrande, a sprawling real estate developer, is that company. Evergrande has the distinction of being the world’s most debt-saddled property developer and has been on life support for months. A steady drumbeat of bad news in the recent weeks has accelerated what many experts warn is inevitable: failure. The ratings agency Fitch said this week that default “appears probable.” Moody’s, another…

In Hong Kong, Jimmy Lai’s Next Digital Says It Has Been Forced to Close

Chin@Strategy

HONG KONG — Next Digital, a Hong Kong media company that has published vehement criticism of the Chinese government for decades, said on Sunday that it would take steps to shut down after an official crackdown had left it with no way to operate. In a statement, the company’s board of directors called for the liquidation of the company and said that they had resigned. “We have concluded that the best interests of shareholders, creditors, employees and other stakeholders will be served by an orderly liquidation,” it said, adding that…