Bankruptcy proceeding against Evergrande unit to proceed, liquidators say

Name: SCMP
Telephone: +852-2680-8888

Bankruptcy filing against Kailong Real Estate was accepted by a Guangzhou court, according to a statement to the Hong Kong stock exchange

Reading Time:2 minutes

Why you can trust SCMP

A file photo shows Evergrande residential buildings under construction in Guangzhou, in China’s southern Guangdong province, on July 18, 2022. Photo: AFP

Cheryl Arcibal

Published: 9:00pm, 19 Aug 2024

A bankruptcy filing against a Guangzhou-based unit of collapsed developer China Evergrande has been accepted by a mainland China court, according to a filing with the Hong Kong stock exchange.

A court in the southeastern Chinese city accepted a bankruptcy liquidation application filed against Guangzhou Kailong Real Estate, an indirect wholly owned subsidiary of the world’s most indebted developer, on August 9, the liquidators of Evergrande said in the filing on Monday.

The intermediate court of Guangzhou will convene a meeting of the first creditors of Guangzhou Kailong on November 14. The “creditors of Guangzhou Kailong are requested to declare their claims to Guangzhou Kailong’s bankruptcy administrator” before November 7, the filing said.

The liquidators gave no other details about the bankruptcy application, according to the disclosure.

Earlier this month, the liquidators said they had made “modest realisations of assets” of Evergrande, but pointed out that the company’s “liquidity and other internal resources remain limited” amid its “level of indebtedness and the challenges faced by the group’s business and operations”.

Trading of Evergrande’s shares has been suspended since January 29, and the liquidators said that “in the absence of substantial new investment into the company, the liquidators do not currently see a path to a restructuring” that would enable the company to resume trading of its shares.