China developer Evergrande files for bankruptcy protection

Embattled Chinese property giant Evergrande Group filed for bankruptcy protection in the United States on Thursday, court documents showed, a measure that protects its US assets while it attempts to restructure. Evergrande, once China’s top property developer, was found in 2021 to be struggling with more than $300-billion in liabilities, as it came under intense pressure after officials tightened scrutiny on the real estate industry.

The company’s woes have come to symbolise the growing crisis in China’s sprawling property sector, which accounts for a huge portion of the world’s number two economy that many fear could spill over globally. Several major developers have been hit in the unfolding drama as they fail to complete housing projects, triggering protests and mortgage boycotts from homebuyers.

In the latest filings in New York, Tianji Holding and Scenery Journey — of which Evergrande is the ultimate holding company — filed for Chapter 15 protection, which provides mechanisms for dealing with insolvency cases involving more than one country.

Evergrande has worked on an offshore debt restructuring agreement for months and unveiled a proposal earlier this year. The plan offers creditors a choice to swap their debt into new notes issued by the company and equities in two subsidiaries, Evergrande Property Services Group and Evergrande New Energy Vehicle Group.

Source: eNCA

In other news – Watch: Inside Musa Mthombeni and Liesl Laurie’s Anniversary vacation

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