Troubled Chinese property developer Evergrande faces liquidation after failing to reach a restructuring deal with its creditors, according to multiple reports Sunday night.
The Wall Street Journal reported that talks between Evergrande
and its creditors began last week with the hope of reaching a deal that would let the company continue to operate, according to the Journal, which cited sources familiar with the matter.
But those talks failed, and a Hong Kong court on Monday ordered the company’s liquidation, in a stunning fall from grace, the New York Times and Bloomberg reported. Evergrande has more than $300 billion in liabilities.
A liquidation will likely reverberate through China’s beleaguered real-estate industry, which has been hammered in recent years as developers have fallen behind on debt as the Chinese government cracked down on lending and property values fell.
Monday’s court hearing for Evergrande was originally scheduled for December, but was postponed to “refine” its debt-restructuring plan, the Associated Press reported last month.
Evergrande’s Hong Kong-traded stock has plunged about 90% over the past 12 months. Trading of the stock was ordered halted Monday.