Evergrande units told to liquidate

Units of two high-profile Chinese companies received Hong Kong court orders to liquidate, the latest in a string of wind-up decisions in the city as creditors ramp up their legal efforts to recover funds.

Tianji Holding became the second key unit of defaulted builder China Evergrande (3333) to receive a wind-up order this year, following a Monday ruling by Judge Linda Chan of Hong Kong's High Court.

She also ordered the liquidation of an investment arm of HNA Group, the Chinese conglomerate that owns shares of Hainan Airlines and other overseas assets.

Distressed Chinese companies have faced a slew of court hearings in Hong Kong in recent months, as the pace of litigation quickens. The years-long property crisis left many firms with large piles of debt and those that aren't able to amass enough support for restructuring proposals increasingly risk liquidation.

Tianji is clearly insolvent and should be placed into liquidation "as soon as possible" to allow an administrator to protect creditors, Chan said. Its parent, Evergrande itself, was ordered to liquidate in early 2024 and its liquidators have been looking to seize its assets.

Bloomberg