Home Business Shares of Evergrande suspended amid reports its chairman under surveillance

Shares of Evergrande suspended amid reports its chairman under surveillance

by Mark Mendoza

Shares of China Evergrande Group were suspended on Thursday, according to an announcement from Hong Kong’s exchange. This is not the first time Evergrande’s shares have been suspended. Last year, trading was suspended in March and only resumed on August 28th after a 17-month hiatus. The chairman of the embattled Chinese real estate developer has reportedly been placed under surveillance.

Evergrande’s shares last closed at 32 Hong Kong cents on Wednesday. The company has been facing financial challenges, and earlier this month, it delayed a debt restructuring meeting with creditors. In a filing, the company stated that the sales of the group have not met expectations since its debt restructuring announcement in March. As a result, Evergrande believes it is necessary to reassess the terms of the proposed restructuring to align with the company’s situation and creditor demands.

Additionally, Evergrande revealed that an investigation into subsidiary Hengda Real Estate has prevented the issuance of new notes under its debt restructuring plan. These challenges have raised concerns about the company’s ability to manage its debt and avoid default.

Evergrande’s troubles have sparked broader concerns about the potential impact on the Chinese economy and the global real estate market. With Evergrande being one of the largest real estate developers in China, its potential collapse could have significant ripple effects.

Investors and analysts are closely monitoring the situation, as any further disruptions or defaults from Evergrande could have far-reaching consequences. The Chinese government has stepped in to manage the situation and prevent a disorderly collapse of the company, but uncertainties remain.

The suspension of Evergrande’s shares highlights the ongoing challenges the company faces and the importance of resolving its debt crisis. As the situation continues to unfold, the fate of Evergrande will have implications not just for the company itself but for the entire real estate industry in China and beyond.

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