On September 11, Guangzhou Evergrande Real Estate Co., Ltd. issued a statement disclosing the situation of some of its overdue debts, with approximately 27.6 billion yuan in overdue interest-bearing debt.
According to the announcement, as of June 30, 2024, the overdue interest-bearing debts of Guangzhou Evergrande Real Estate Co., Ltd. included 84.54 billion yuan in overdue bank loans, 125.88 billion yuan in overdue non-bank financial institution loans, and 65.70 billion yuan in other overdue interest-bearing debts, all overdue in both principal and interest.
Evergrande Real Estate stated in the announcement that the company is actively communicating with relevant creditors, addressing their concerns, formulating and implementing solutions, and continuously working towards resolving the overdue debts.
Just one month ago, Evergrande Real Estate issued a notice of overdue US dollar bonds on the Hong Kong Stock Exchange.
The announcement at that time mentioned that Evergrande Real Estate’s subsidiary, Evergrande Properties Limited, had three senior notes issued overseas that were due to pay interest in cash on July 11 this year, with a 30-day grace period. However, due to the cash flow pressure faced by the group, the interest payment has not been made in cash up to now, totaling 147 million US dollars.
Failure to pay the interest on the Evergrande Properties limited notes could lead to demands for accelerated repayment by the holders of the notes.
In order to develop an overall debt management plan for the group’s foreign debt, Evergrande Real Estate has retained Aon Financing Consultants Limited as financial advisers and hired Shengde Law Firm as legal advisers.
On the 7th and 8th of a prior month, Evergrande Real Estate’s wholly-owned subsidiary, Zhaoxi Limited, received a winding-up petition filed by Seatown Private Credit Master Fund in the High Court of the Hong Kong Special Administrative Region, involving approximately 614 million US dollars in outstanding principal and interest payable proportional to the petitioner. The petition will be heard on September 25.
On August 20, Evergrande Real Estate announced that on August 19, its wholly-owned subsidiary, Evergrande Real Estate (Hong Kong) Limited, one of the guarantors under a financing agreement, received a winding-up petition submitted by the petitioner (one of the lenders holding 18% of the outstanding principal of the loan) in the High Court regarding the outstanding principal and interest payable on behalf of Evergrande Hong Kong. The petition against Evergrande Hong Kong will be heard in the High Court in Hong Kong on October 30, 2024.
Established in 1994 with headquarters in Guangzhou, Evergrande Real Estate went public in Hong Kong in 2005. It was once renowned as one of the “Southern Five Tigers” in the real estate sector.
In 2017, Evergrande Real Estate made a low-priced acquisition of 76 hotel projects and a 70% equity interest in Wanda Cultural Tourism City in Yantai from the Dalian Wanda Group for 19.906 billion yuan. Since then, the real estate company has been embroiled in a debt crisis. In July 2023, Evergrande Real Estate faced bankruptcy liquidation proceedings initiated by Guangdong Xiangzheng Trading Co., Ltd., and Guangzhou Guangfeng Concrete Co., Ltd.