China Evergrande Handed Delisting Deadline by HK Exchange

The Hong Kong Stock Exchange has warned China Evergrande it must remedy the issues that led to its trading suspension by September 2023, the company advised in a notice this week.

Evergrande said the Hong Kong exchange warned the company that it must resolve its problems by Sept 20, 2023 to avoid a possible delisting of its shares.

“The Stock Exchange also has the right to impose a shorter specific remedial period, where appropriate,” Evergrande said, citing the stock exchange in the filing.

The debt-laden developer said it will announce its preliminary restructuring plan before the end of July, as it battles to get on top of a massive debt crisis.

The company, whose offshore debt was deemed to be in default after it missed payments due late last year, has total liabilities of more than $300 billion.

Stock Exchange Note

In a stock exchange filing late on Monday, Evergrande also said it does not have a timeline for publishing its 2021 annual results or completing a probe into its property services unit.

Shares of embattled Evergrande have been suspended from trading since March 21, as it was not able to deliver its financial results on time and its unit Evergrande Property Services Group was investigating how banks seized 13.4 billion yuan in deposits that had been pledged as security for third party guarantees.

It also said it was “actively pushing forward with its restructuring work,” and expects to announce its plan before the end of July, as per its original deadline announced in late January.

In the proposal, Evergrande was considering repaying offshore public bondholders owed around $19 billion with cash instalments and equity in its two Hong Kong-listed units, as reported last month.

Offshore bonds of Evergrande were trading at around 9 cents on the dollar on Tuesday, according to data by Duration Finance.

Its units, China Evergrande New Energy Vehicle and Evergrande Property Services, issued similar releases separately. Their shares are also under suspension, and will remain so until further notice, they said.

• Reuters with additional editing by Jim Pollard