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Saturday, October 16, 2021

Evergrande – the Chinese developer is to pay off part of the debt

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Evergrande has reached an agreement with investors on the payment of interest on yuan bonds falling on Thursday, the company belonging to the Chinese giant said in a stock exchange announcement. The financial situation of one of the largest real estate companies is closely monitored by analysts from around the world. Recently, a developer has warned that it may not pay off its astronomical debt.

Evergrande’s Hengda Real Estate Group issued a stock exchange announcement regarding the repayment of interest on its bonds denominated in yuan. The issue of payments “was resolved through negotiations with the clearing house,” reported Hengenda Real Estate Group. The company, however, did not specify how much of the interest it will pay off and when it will pay off. It should pay 232 million yuan ($ 36 million) by Thursday.

According to Reuters, the developer’s signal will provide relief to markets where concerns about the default of the Chinese developer were clearly visible. According to analysts, the possible bankruptcy of the largest Chinese real estate company could contribute to significant perturbations in the global economy.

However, the Bloomberg agency points out that the statement did not provide many details.

“The company’s notification prompted some analysts to speculate that Evergrande had entered into an agreement with creditors to defer interest payments without having to label the move as default,” writes the agency.

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Evergrande’s trouble PAP / EPA / ALEX PLAVEVSKI

“They could have asked investors not to take action on a non-timely payment while waiting for schedule change negotiations or something like that,” said Bloomberg Intelligence analyst Daniel Fan.

Evergrande and billions in debts

This week, the indebted company is facing several deadlines for the repayment of liabilities which are critical from the point of view of its functioning. Evergrande was due to pay off interest on some bank loans on Monday. However, according to Bloomberg, the Chinese authorities informed the developer’s creditors that they would not receive their debts for the time being.

Evergrande’s trouble PAP / EPA / ALEX PLAVEVSKI

This week, Evergrande is due to pay other interest of $ 100 million.

“It is unclear what part of these obligations – if any – Evergrande will be able to repay. The group is the most indebted developer in China, with debt exceeding $ 300 billion. that he could go bankrupt if he is not able to raise money quickly, “reads the CNN website

Main photo source: PAP / EPA / ALEX PLAVEVSKI



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