On the evening of September 24, China Evergrande announced an inside story in Hong Kong stocks.
China Evergrande said that given that its subsidiary, Evergrande Real Estate Group, is under investigation, the group's current situation cannot meet the eligibility for the issuance of new notes.
The issuance of new notes is an important part of China Evergrande's offshore debt restructuring plan, which involved more than US$19 billion. According to China Evergrande's disclosure at the end of March, the main plan for the company's overseas debt restructuring is to replace the original bonds with newly issued bonds: the new bonds have a maturity of 4 to 12 years and an annual interest rate of 2% to 7.5%; No interest is paid for the first 3 years, and interest is paid at 0.5% of the principal amount starting at the beginning of the 4th year.
Now that China Evergrande is unable to meet the qualifications for the issuance of new notes, it means that the above plan is bound to undergo a large-scale adjustment.
On September 25, China Evergrande's stock price plunged, closing down more than 25% at HK$0.41 per share at midday, with a market value of only more than HK$5 billion.
On Friday, China Evergrande Group released an update on overseas debt restructuring. The announcement said that since March 22 this year, the sales of Evergrande Group have not been as good as the company expected. Based on the Company's current circumstances and consultations with its advisers and creditors, the Company believes that it is necessary to revisit the terms of the proposed restructuring to match its objective circumstances and creditors' demands.
In view of the above, the meetings on the proposed restructuring scheduled for 25 September and 26 September will not be held. If there are any changes to the terms of the proposed restructuring, the Company will announce it separately.
According to the financial report, China Evergrande has a net loss of RMB 105.9 billion in 2022, total liabilities of RMB 2.44 trillion, and total assets of RMB 1.84 trillion, which is insolvent.
Image source: Flush
Source: China News Network, Securities Times, public information and market data
Responsible editor Sun Xiao