Staff reporter and Reuters
Shares of China Evergrande (3333) tumbled on unpaid interest yesterday as a government official said mergers and acquisitions will help Chinese property firms lower their debt.
The embattled developer slumped 9 percent after it did not pay offshore coupons due earlier this week.
Evergrande, whose US$19 billion (HK$148.2 billion) in international bonds are in cross-default after missing a deadline to pay coupons earlier this month, had new coupon payments worth US$255 million due on Tuesday for its June 2023 and 2025 notes.
Some bondholders holding the two bonds have not yet received the coupons, according to three sources with knowledge of the matter. Both the payments have a 30-day grace period.
This came as, Zou Lan, the head of financial markets at the People's Bank of China, said mergers and acquisitions in the Chinese property market will help firms lower their debt.
"Mergers and acquisitions of projects between real estate companies are the most effective market-oriented means for real estate companies to resolve risks," Zou told reporters.
Meanwhile, The Hong Kong-based agency Ricacorp Properties has sued China Evergrande for unpaid commissions worth HK$35.5 million, involving 197 units of Emerald Bay in Tuen Mun handled by 250 agents. Earlier this week, Centaline sued Evergrande over similar accusations.
Elsewhere, Hengchi 5, the first production model of Evergrande's electric vehicle unit, has rolled off the production lines yesterday ahead of schedule, which was supposed to be in early January next year, according to reports.
