In the wake of the bankruptcy reorganization applications filed by two automotive companies under the Evergrande Group, the parent company of Evergrande Group, Kaileong Property, has recently been petitioned for bankruptcy reorganization by creditors.
According to an announcement released by Guangdong Wanhe New Electric Co., Ltd. (“Wanhe Electric”) on August 6, the company applied for the bankruptcy liquidation of Kaileong Property, a company indebted to it, at the Guangzhou Intermediate People’s Court on August 5. The court convened on August 6 to review the application for the bankruptcy liquidation of Kaileong Property.
Kaileong Property’s business registration information shows that it is located in the Haizhu District of Guangzhou, with Han Xue as its legal representative, and Guangzhou Chaofeng Property Co., Ltd. as its shareholder. Its registered capital is 43.6 billion yuan, with business operations covering real estate agency services, real estate consulting services, and market marketing planning services.
Information from Tianyancha indicates that Kaileong Property has multiple enforcement cases and consumption restriction orders against it.
As reported by the Daily Economic News, Kaileong Property holds a 60.29% stake in Evergrande Real Estate Group Limited and a 100% stake in Evergrande Group Limited.
The announcement from Wanhe Electric reveals that on December 29, 2022, the Shenzhen International Arbitration Court rendered judgment on the arbitration case brought by the company against Kaileong Property. The ruling stated that Kaileong Property was to pay the company an investment sum of 200 million yuan, with an annual interest rate of 10% starting from March 1, 2021 until the date of full repayment of the investment amount. The arbitration fee of 1,452,221 yuan was to be borne by Kaileong Property and paid directly to the company. Kaileong Property was required to fulfill the above payment obligations within 15 days of the ruling.
Following the effectiveness of the judgment, Kaileong Property failed to fulfill its debt obligations in accordance with the ruling. Wanhe Electric subsequently applied for compulsory enforcement at the Guangzhou Intermediate People’s Court. The court accepted the case on February 14, 2023, but as of now, no payments have been enforced.
Officials from Evergrande Real Estate Group Limited informed 21st Century Economic Report that they have been made aware of the bankruptcy application against Kaileong Property. Kaileong Property serves as the holding platform company for Evergrande Real Estate and is not engaged in specific real estate projects.
On July 28, Evergrande Automotive, a subsidiary of Evergrande Group, announced on the Hong Kong Stock Exchange that its affiliates, Evergrande New Energy Vehicles and Evergrande Intelligent Vehicles, received notifications from relevant courts on July 26, 2024. Individual creditors of the affiliates applied for bankruptcy reorganization of the companies on July 25, 2024.
Public records show that Evergrande New Energy Vehicles and Evergrande Intelligent Vehicles are wholly-owned subsidiaries under Evergrande Automotive.
In 2021, Evergrande Group faced a debt crisis, owing creditors, suppliers, 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 of the Board, Xu Jiaying, was under investigation for suspected illegal activities and was subject to compulsory measures.
On the 5th of this month, China Evergrande announced on the Hong Kong Stock Exchange that the company is pursuing legal avenues to recover approximately $6 billion in dividends and remuneration from its executive directors, Xu Jiaying, former CEO Xia Haijun, former CFO Pan Darong, and seven other defendants, including Xu Jiaying’s spouse or former spouse, Ding Yumei.