Evergrande’s creditors warned of the possibility of an “uncontrollable collapse” of the company.
[ad_1]
Delaying a deal to restructure the debt of Chinese property developer Evergrande could lead to the company’s liquidation and “uncontrollable collapse”, as well as a “catastrophic impact” on other troubled companies in the Chinese real estate industry. This was written today, October 9, The Wall Street Journal And Financial Timesciting a statement from a group of the company’s creditors who own its $6 billion bonds. The group of creditors is represented by the investment bank Moelis and the law firm Kirkland & Ellis.
Evergrande crisis continues from 2021. Then it became known about the holding’s serious financial problems. Company suspended shares trading on March 21, 2022. Evergrande then went through a complex restructuring process and resumed trading on August 28 this year after a 17-month hiatus. At the end of September, trading in Evergrande shares was suspended again after… messages that the founder and chairman of the board of directors of the group, Xu Jiayin, was detained by the police and is under investigation. Trading resumed on October 3.
Evergrande also previously said the investigation was preventing it from issuing new debt and thereby preventing it from implementing its debt restructuring plan. However, investors quoted by the publications doubt that Evergrande has made enough efforts to convince the regulator of the need for restructuring. They also note that if the company does not receive approval for the restructuring deal by October 30, the deal will be terminated, which could lead to the collapse of the company.
Evergrande’s debts reached $332 billion in June. Last week Reuters has already reported that a group of foreign creditors is ready to join a lawsuit to liquidate the developer if he does not submit an updated restructuring plan by October 30.
[ad_2]
Source link
