Evergrande halts talks on stake sale

Finance | Staff Reporter and Agencies 20 Oct 2021

China Evergrande (3333) has suspended negotiations to sell a 51 percent stake in its property management unit Evergrande Property Services (6666) to Hopson Development (0754) as the indebted developer did not win the nod from the Guangdong government, REDD reported.

Meanwhile, Shimao Services (0873) plans to raise HK$1.7 billion through a share placement, offering the lowest price at HK$15.18 apiece, a 9.75 percent discount to the previous closing price, local media reported. The company's subsidiary will also issue a guaranteed convertible bond with a total price of HK$3.11 billion due in 2022.

Back to Evergrande, Hengda Real Estate Group, Evergrande's flagship unit, has remitted funds to pay an onshore bond coupon of 121.8 million yuan. However, another Evergrande bond due on March 23, 2022, will officially be in default if the company does not make good after a 30-day grace period for a missed coupon payment that had been due on September 23.

Meanwhile, Evergrande is said to be selling the equity of a residential project, The Vertex in Cheung Sha Wan, to the project's partner shareholder, VMS.

China's property and construction industries contracted in the third quarter for the first time since the start of the pandemic, weighed down by a slump in real estate. Output in the real-estate industry, a mainstay of the economy as its activities support sectors from furniture to commodities, shrank 1.6 percent from a year ago, said a supplemental report on gross domestic product by the National Bureau of Statistics.



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