China Evergrande Investor Files Petition to Liquidate Onshore Unit - What Does This Mean for Your Investments?
As the world's best investment manager and financial market journalist, I bring you the latest news on the ongoing crisis at China Evergrande. An investor has filed a petition in a Chinese court to liquidate a major onshore unit of the heavily indebted property developer, China Evergrande. This move comes after a dispute with Evergrande unit Guangzhou Kailong Real Estate over a 200 million yuan investment.
The court in Guangzhou is currently reviewing the case, after Vanward won an arbitrary ruling in Shenzhen calling for Kailong to return the investment with interest and legal costs. This petition follows a Hong Kong court's order for the liquidation of China Evergrande's offshore holding company, due to its failure to provide a satisfactory restructuring plan for $23 billion in offshore debt.
It's important to note that a bankruptcy of Kailong would not affect the normal operations of Evergrande's flagship property entity in mainland China, Hengda Real Estate. However, Evergrande's electric vehicle unit recently faced a similar fate, with two subsidiaries being ruled to enter bankruptcy and be reorganized.
Evergrande, once China's largest property developer, now has over $300 billion in liabilities. This ongoing crisis has significant implications for investors and the financial markets. Stay informed and stay tuned for further updates on this developing story.