- Trading in shares of the Evergrande Property Services unit was also discontinued
- Suspensions come days after bondholders said Evergrande missed interest payments
- Trading in shares of the Chinese property developer Hopson Development has also been suspended
- Hopson says trading has been suspended pending the announcement of a “major acquisition”
HONG KONG, Oct. 4 (Reuters) – Trading in shares of the heavily indebted China Evergrande (3333.HK) was suspended Monday, days after some bondholders said the real estate developer, at the center of nervousness over China’s financial system, missed a second major bond interest payment .
The shares of its unit Evergrande Property Services Group (6666.HK) have also been suspended, the Hong Kong Stock Exchange said. The exchange did not say why the companies’ shares were suspended, and it was unclear who initiated the suspension.
Evergrande did not immediately respond to a request for comment.
With liabilities totaling hundreds of billions of dollars, equivalent to 2% of China’s gross domestic product, Evergrande has raised concerns that its troubles could spread into the financial system and reverberate around the world. Initial concerns have subsided after China’s central bank promised to protect homebuyers’ interests. Continue reading
Monday’s suspension of stock trading left a shiver through broader financial markets, which remain nervous about contagion, pushing the offshore yuan a little lower and weighing on the Hang Seng benchmark index, and particularly financials and other developers. Guangzhou R&F Properties Co Ltd (2777, HK) fell 7%, Sunac China Holdings (1918, HK) and Country Garden (2007, HK) each fell 4%.
Evergrande’s shares are down 80% so far this year, while the real estate services unit is down 43% as the group scrambles to raise funds to pay its many lenders and suppliers. Continue reading
Electric vehicle division China Evergrande New Energy Vehicle Group (0708.HK) fell as much as 8% early Monday before absorbing losses.
The insolvent group announced on Sept. 30 that its asset management unit had repaid 10% of the same date asset management products (WMPs), most of which are owned by onshore retail investors.
Once China’s top-selling real estate developer and now likely the subject of one of the country’s largest restructurings, Evergrande has prioritized domestic creditors over offshore bondholders.
The two offshore payments, which bondholders said were not received by their due date, come as the company, which has nearly $ 20 billion offshore debt, has deadlines for coupon payments next month of dollar bonds totaling $ 162.38 million is faced.
Beijing is urging state firms and government-backed real estate developers to buy some of Evergrande’s assets and are exploring them either directly or indirectly via asset purchases, those knowledgeable told Reuters last week. Continue reading
Meanwhile, Chinese real estate group Hopson Development (0754.HK) announced in a statement Monday that it had suspended trading of its shares pending an announcement related to Hopson’s major acquisition of a Hong Kong-listed company and a possible mandatory offer .
It was unclear whether the deal was related to the Evergrande Group, and Hopson didn’t respond to a request for further comments.
Hopson’s shares, valued at HK $ 60.4 billion (US $ 7.8 billion), are up 40% so far this year.
($ 1 = 7.7868 Hong Kong dollars)
Reporting by Anne Marie Roantree and Donny Kwok; Additional coverage from Tom Westbrook in Singapore; Editing by Kim Coghill and Kenneth Maxwell
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