China Evergrande Group, with nearly two trillion yuan in debt, has been facing relentless actions from creditors since its default. Recently, the 13 billion yuan equity held by Evergrande Group in Evergrande Financial has been frozen, attracting attention.
According to legal proceedings information from Tianyancha, on August 7, Evergrande Group Limited added information on the freezing of equity, with the enterprise whose equity was executed being Evergrande Financial Holdings Group (Shenzhen) Co., Ltd., with a frozen equity amount of 13 billion yuan, and the executing court being the Cangzhou Intermediate People’s Court in Hebei Province.
Evergrande Financial Holdings Group (Shenzhen) Co., Ltd. was established in November 2015, with Han Xue as the legal representative, registered capital of 13 billion yuan, and fully owned by Evergrande Group Limited.
Risk information shows that Evergrande Group Limited currently has multiple pieces of equity freezing information, with equities in multiple companies it holds being frozen. Furthermore, the company also has multiple instances of debtors, dishonest debtors (laolai), consumption restrictions, and final case information.
In addition, Evergrande Group’s parent company, Kalon Properties, recently faced an application for bankruptcy reorganization from creditors totaling more than 7.8 billion yuan. Kalon Properties is a 100% shareholder of Evergrande Group Limited.
On July 28, Evergrande Group’s subsidiary, Evergrande Motors, announced on the Hong Kong Stock Exchange that the affiliated companies Evergrande NEV and Evergrande Intelligent Vehicle (related affiliates) received notices from the relevant local court on July 26, 2024. Individual creditors of the related affiliates applied for bankruptcy reorganization of the related affiliates on July 25, 2024.
On August 5, China Evergrande released an announcement stating that on March 22, 2024, the liquidator initiated legal proceedings in the name of the company in the High Court of the Hong Kong Special Administrative Region against three defendants, namely Xu Jiayin, former CEO Xia Haijun, and former CFO Pan Darong. The lawsuit gradually expanded to include four other defendants, namely Xu Jiayin’s spouse or former spouse Ding Yumei and three entities related to Xu Jiayin and Ding Yumei.
In this lawsuit, the company seeks to recover approximately 6 billion US dollars (approximately 42.728 billion yuan) in dividends and compensation paid to the seven defendants for financial years ending December 31, 2017, to December 31, 2020, which the company claims were misreported.
Evergrande Group faced a debt crisis in 2021, owing suppliers, creditors, and investors a total of over 1.96 trillion yuan. On August 17, 2023, Evergrande Group filed for bankruptcy protection in New York, USA. On the evening of September 28 of the same year, Evergrande announced that its founder and chairman, Xu Jiayin, is suspected of illegal activities and has been subject to compulsory measures.