In China, they demand the liquidation of another large developer – Kommersant
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Chinese developer Shimao Group Holdings (.pdf) announced today, April 8, that one of its creditors has filed a claim to force the company into liquidation.
The application was submitted by the state-owned China Construction Bank on April 5 in Hong Kong. The reason for the petition was the developer’s debt of 1.58 billion Hong Kong dollars ($204 million). Shimao said it opposes the liquidation of the company as it believes it is against the interests of investors and will seek a restructuring of offshore debts.
Shimao was one of the ten largest developers in China back in 2020, but in 2021 it found itself in a crisis, like many other developers in the country. In July 2022, the company defaulted on offshore bonds.
The crisis in the Chinese real estate market has been observed since the fall of 2021, when it became known about the serious financial problems of the China Evergrande Group holding. Its assets were then estimated at $240 billion, and its debts at more than $300 billion. As a result, in January of this year, the Hong Kong court decided to liquidation once China’s largest developer.
In February, a lawsuit for forced liquidation was filed against another major Chinese developer – Country Garden — for non-payment of debts on a loan of 1.6 billion Hong Kong dollars (about $204 million). In March, Country Garden defaulted on its bonds again and also announced an indefinite deferral of its 2023 financial statements.
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