Home Feature H. Kong court orders Evergrande to liquidate

H. Kong court orders Evergrande to liquidate

by Nada Ali
Evergrande

Chinese developer Evergrande has been ordered to liquidate by a Hong Kong court following a failed effort to restructure $300 billion owed to banks and bondholders, Reuters reported on Monday.

Judge Linda Chan said it was appropriate for the court to order Evergrande to conclude its business given a “lack of progress on the part of the company putting forward a viable restructuring proposal” as well as Evergrande’s bankruptcy.

Evergrande shares trading in Hong Kong fell 21 per cent ahead of the order. The move is expected to further sap confidence in Chinese and Hong Kong equities, which have lost more than $9 trillion in value since their 2021 peak.

“Evergrande’s liquidation is a sign that China is willing to go to extreme ends to quell the property bubble,” Orient Capital Research managing director Andrew Collier, told Reuters.

Chinese President Xi Jinping deemed the debt accrued by Evergrande and other property firms an unacceptable risk for China’s financial system and overall economic health.

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