The crisis at China Evergrande Group deepened Monday after the company’s mainland unit said it failed to repay an onshore bond, adding a new layer of uncertainty to the developer’s future as a restructuring plan with its offshore creditors teeters.
The builder at the center of China’s property developer crisis said its Hengda Real Estate Group Co. subsidiary defaulted on 4 billion yuan ($547 million) in principal plus interest due Sept. 25. In March, Hengda missed an interest payment on the 5.8% yuan bond issued in 2020, and said it would “actively” negotiate with bondholders to find a solution, a promise it reiterated in Monday’s statement.
Evergrande is running out of time to get what would be one of the nation’s biggest-ever restructurings back on track after setbacks in recent days have raised the risk of a potential liquidation. The company has scrapped key creditor meetings at the last minute, saying it must revisit its restructuring plan, faced the detention of money management unit staff, and been unable to meet regulator qualifications to issue new bonds.
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