Chinese developer Country Garden is facing a liquidation petition for non-payment of a $205 million loan, which could complicate its debt restructuring efforts and undermine confidence in the property sector, Reuters reported on Wednesday.
The petition was filed by Ever Credit Limited, a unit of Hong Kong-listed Kingboard Holdings, and a court hearing is scheduled for May 17. Country Garden has stated that it will oppose the petition.
The company’s shares have dropped 11 per cent in response to the news. This development comes at a time when China is trying to restore confidence in the property market, which is a significant contributor to the country’s GDP.
This petition follows the liquidation order for China Evergrande Group, the world’s most indebted property developer, and reflects the ongoing challenges in the Chinese property sector since a regulatory crackdown on debt-fuelled construction in 2021.
