Real estate giant China Evergrande suspends operations in Hong Kong market – business
Hong Kong, China â
Mon, October 4, 2021
Ailing real estate giant China Evergrande on Monday suspended trading of its shares on the Hong Kong Stock Exchange without giving any reason.
The company’s stock price has plunged about 80% since the start of the year as it is on the verge of collapse as it struggles under a mountain of debt.
âTrading in shares of China Evergrande Group will be halted,â he said in a statement to the stock exchange. “Accordingly, all structured products relating to the Company will also be suspended from trading at the same time.”
Shares in his electric vehicle company, which last week canceled a listing proposal in Shanghai, were not suspended, although they fell 6% at the start of trading.
Company officials are struggling to cope with a crisis that has left it with more than $ 300 billion in debt, fueling fears of contagion to the wider Chinese economy which some say could spill over into the future. spread globally.
Last week, she announced she would sell a $ 1.5 billion stake in a regional Chinese bank to raise much-needed capital, as she struggles to pay interest to bondholders.
Beijing has been silent on the struggles of the real estate empire, but state media followed various responses in a nod to the mood towards a private company that grew on a debt spree during the boom years. of Chinese real estate.
Authorities have asked local governments to prepare for the potential collapse of Evergrande, according to reports, suggesting that a major state bailout is unlikely.
The liquidity crunch has sparked public anger and rare protests outside its offices in China as investors and suppliers demand their money back.
The group admitted facing “unprecedented challenges” and warned it might not be able to meet its commitments.
The country’s real estate sector has come under scrutiny in recent months, with regulators last year announcing caps on three different debt ratios under a program dubbed “three red lines.”