A Hong Kong court on Jan 29 ordered the liquidation of China Evergrande Group, a move likely to send ripples through China's crumbling financial markets as policymakers scramble to contain the deepening crisis.
Evergrande shares plunged 20.9 per cent in Hong Kong before the hearing. Trading was halted in the company and its listed subsidiaries, China Evergrande New Energy Vehicle Group and Evergrande Property Services, after the verdict.
The decision to liquidate the world's most indebted developer, with more than US$300 billion (S$402.3 billion) of total liabilities, was made by Hong Kong High Court Justice Linda Chan. She noted that Evergrande had been unable to offer a concrete restructuring plan despite months of delays.
"It is time for the court to say enough is enough," she said.
The decision sets the stage for what is expected to be a drawn-out and complicated process with potential political considerations as investors watch whether the Chinese courts will recognise Hong Kong's ruling, given the many authorities involved. Offshore investors will be focused on how the Chinese authorities treat foreign creditors when a company fails.
This story is from the January 30, 2024 edition of The Straits Times.
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This story is from the January 30, 2024 edition of The Straits Times.
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