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China Evergrande lenders appoint receiver to seize Hong Kong headquarters - sources

Published 09/08/2022, 06:40 AM
Updated 09/08/2022, 08:21 AM
© Reuters. FILE PHOTO: The company logo is seen on the headquarters of China Evergrande Group in Shenzhen, Guangdong province, China September 26, 2021. REUTERS/Aly Song

By Clare Jim

(Reuters) -Lenders of struggling Chinese developer Evergrande Group have appointed a receiver this week to seize its Hong Kong headquarters, two sources said, as the world's most indebted developer struggles to emerge from its debt crisis.

Saddled with more than $300 billion in liabilities, Evergrande has been trying to sell its 26-storey China Evergrande Centre in Hong Kong's Wan Chai district after a potential $1.7 billion deal collapsed late last year, as part of the asset disposal effort to raise funds.

The Hong Kong tower has been pledged for a loan by lenders led by China Citic Bank International, the Hong Kong subsidiary of the Chinese state-owned bank China Citic Bank Corp Ltd.

Evergrande declined to comment. Citic Bank did not immediately respond to Reuters' request for comment. The news was first reported on Thursday by the Financial Times.

Reuters reported in July, citing sources, that Evergrande was looking to sell its Hong Kong headquarters via a tendering process and the sale proceeds would be used to repay offshore creditors as part of the debt restructuring plan.

However, one person familiar with the situation said on Thursday that during the July sale around three bidders had offered lower than HK$10 billion ($1.27 billion), and the bid was too low for Evergrande to accept.

© Reuters. FILE PHOTO: The company logo is seen on the headquarters of China Evergrande Group in Shenzhen, Guangdong province, China September 26, 2021. REUTERS/Aly Song

Evergrande missed a self-imposed deadline to provide a detailed restructuring proposal by end-July. It said in an update in July that the due diligence process was continuing, and expected the work to be completed in the near future, with an aim to announce a specific plan in 2022.

($1 = 7.8496 Hong Kong dollars)

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