Liquidators will take control of the company’s assets and prepare to sell them in order to repay the company’s debts — which total $300 billion.
China Evergrande — the world’s most indebted property developer — received a liquidation order from a Hong Kong court on Monday, but there may be little left to recover, said experts.
The order came more than two years after Evergrande sent the country’s property sector into a tailspin.
Liquidators will now take control of the company’s assets and prepare to sell them in order to repay the company’s debts, which total $300 billion.
An offshore investor named Top Shine Global brought the winding-up lawsuit against Evergrande in 2022. Its proceedings were adjourned multiple times as Evergrande sought more time to restructure its debts.
On Monday, Evergrande applied for another adjournment. But Judge Linda Chan said Evergrande had been unable to offer a concrete restructuring plan and ordered its liquidation.
“It is time for the court to say enough is enough,” said Chan, according to Reuters.
Trading in the shares of Evergrande and its subsidiaries was halted on Monday following news of the order. Hong Kong-listed China Evergrande Group’s stock price plunged 21% before the court hearing.
Evergrande did not immediately respond to a request for comment from BI.
Monday’s court order is a far cry from Evergrande’s heyday as China’s top developer by sales in 2016.
Evergrande has been mired in a liquidity crisis since 2021. It first defaulted on an offshore dollar bond in December of that year.
