A Hong Kong court has ordered the liquidation of China Evergrande, the world’s most heavily indebted real estate developer, after a failed attempt to restructure its $300 billion owed to banks and bondholders, Associated Press reports.
The court cited Evergrande’s lack of progress in presenting a viable restructuring proposal and its insolvency as reasons for the decision. The ruling follows Evergrande’s default on financial obligations in 2021.
The court documents revealed that Evergrande owes about $25.4 billion to foreign creditors, with total liabilities exceeding its total assets of about $240 billion. The company’s shares fell nearly 21% following the announcement.
The move comes amid concerns about China’s rising debt burden, as dozens of Chinese developers have collapsed since 2020 under official pressure to control surging debt.
