A Hong Kong court ordered the liquidation of China Evergrande Group on Monday after its overseas creditors failed to reach a deal this weekend to restructure the debt-piling real estate company.
The order to wind up could send waves of concerns through China’s financial markets as the company carrying over $300 billion of liabilities will be liquidated amid authorities’ effort to shore up the stock market. The crash of Evergrand since the default of its offshore debentures in late 2021 had caused other developers to crumble as well.
The share price of Evergrande (HK: 3333) plunged 20% this morning before being halted by regulators following the court order.
Meanwhile, the Hang Seng Properties Index immediately erased 1.5% of its early gains in the morning session after it was up 2.5% at the open.
