Debt-laden developer China Evergrande’s shares continue its descent after resuming trading in Hong Kong today with more news in the backdrop related to fundraising challenges.
China Evergrande saw its shares tumble another 12.5 percent today after resumed trading following a 17-day halt.
Year-to-date, the property developer’s stock price has plunged more than 80 percent.
Fundraising Challenges
Evergrande continues to face challenges to raise funds via asset sales to pay off its liabilities which total more than $300 billion.
On Wednesday, a deal to sell part of Evergrande’s property services unit to Guangzhou-Headquartered Hopson for $2.6 billion fell through. There may have been a disagreement over the payment method with Evergrande seeking immediate payment while Hopson wanted to pay after completing due diligence on payable accounts and receivables with suppliers, according to a statement.
Earlier this week, another deal fell through after Chinese state-owned Yuexiu Property pulled out of a proposed $1.7 billion deal to buy China Evergrande’s Hong Kong headquarters building over debt-related worries, according to a «Reuters» report citing unnamed sources.
Grace Period Nearing End
Meanwhile, China Evergrande faces a series of deadlines with regard to 30-day grace periods for its offshore bonds.
Since September 23, Evergande has missed several payments on its offshore dollar bonds and if it fails to complete the payment on October 23, it will be officially deemed to have defaulted.