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China Evergrande downplays impact of staff arrests in Shenzhen, as property management unit warns on debts
- Police in China have detained – for the first time – a number of employees at China Evergrande Wealth
- Meanwhile Evergrande Property Services, the property-management affiliate of China Evergrande Group, warns on debts
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Indebted property giant China Evergrande said that the arrest of certain members of staff from its insurance unit Evergrande Wealth Management would have no impact on its operations, according to a filing by the property developer with Hong Kong Exchanges and Clearing (HKEX).
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Meanwhile Evergrande Property Services, the property-management affiliate of China Evergrande Group, said it remains uncertain whether it can meet its debts in the next 12 months after securing 13.4 billion yuan (US$1.84 billion) in loans for the embattled developer, according to a separate exchange filing on Monday.
China Evergrande said that the detention of personnel from Evergrande Wealth Management, its wholly-owned subsidiary, “will not affect the company’s operations”.
Police in China detained – for the first time – a number of employees at China Evergrande Wealth two weeks after the group again failed to make payments on its investment products.
Police in the city of Shenzhen in the southern province of Guangdong, where the cash-strapped developer is headquartered, said at the weekend that they had detained employees from Evergrande Wealth Management, including a person surnamed Du. Du Liang is the unit’s general manager but it is not known if he is among those detained.
Meanwhile, Evergrande Property Services warned on its debts – specifically a pledge guarantee it made to obtain loans, whose proceeds China Evergrande has used for its own operational purposes, including a 9.75 billion yuan loan to redeem an offshore bond in February 2021.
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