EVERGRANDE CRISIS: Evergrande chairman has sold $1.1 billion worth of his personal assets

EVERGRANDE CRISIS: Evergrande chairman has sold $1.1 billion worth of his personal assets

Evergrande chairman has sold $1.1 billion worth of his personal assets to prop up the company.
Evergrande chairman Xu Jiayin has sold more than 7 billion yuan ($1.1 billion) worth of personal assets to prop up his embattled company, Chinese state media reported this week.

Xu has sold several houses in Hong Kong, Guangzhou and Shenzhen, as well as some private jets, the state-owned China Business News reported Tuesday, citing anonymous sources close to the matter.
The cash, which Xu has been pumping into Evergrande since the beginning of July, has been used to "maintain the basic operations of his huge business empire," the paper reported, adding that the money has been used to pay staff salaries, interest payments on some bonds and cash owed to investors in its wealth product. The money has also gone toward finishing property projects across China.
"So far Xu Jiayin has been personally raising money to continue the life of Evergrande," the media outlet wrote.
Evergrande did not immediately respond to a request for comment from CNN Business about the report.
Shares in the company rose as much as 4.3% in Hong Kong on Wednesday morning, though by the afternoon they had pared gains and were last up 1.1%. So far this year, the stock is down 80%.
Evergrande has been trying to shed assets to avoid defaults as it grapples with more than $300 billion liabilities, but its efforts have been met with mixed success.
In late September, the company announced that it would sell a $1.5 billion stake in Shenyang-based Shengjing Bank to a state-owned asset management company. But last month, it called off a plan to sell a majority stake in its property management unit for $2.6 billion to rival Hopson Development Holdings. Both companies said they were unable to agree on terms of the deal.
Speculation about Xu's role in keeping the company afloat has mounted. Bloomberg, for example, reported late last month — citing anonymous sources — that Chinese authorities have told Xu to use his personal wealth to pay the company's debts.
Xu can presumably only do so much. His personal wealth is valued at about $7.9 billion, according to the Bloomberg Billionaires Index — far less than the hundreds of billions of dollars that Evergrande carries in debt.
So far, though, the company appears to have avoided defaulting on any of its publicly traded offshore bonds by paying overdue interest before grace periods expire for each of those obligations.
It has another deadline coming up for an overdue payment on a dollar-denominated bond. The 30-day grace period for that bond expires November 29, according to Eikon Refinitiv.
Broader debt worries

dw newsevergrandeevergrande collapse

Post a Comment

0 Comments