Embattled Chinese property developer Evergrande has announced that it has come to an agreement with its creditors to restructure their outstanding U.S dollar denominated bonds. The restructuring agreement was announced on Tuesday after trading had closed in Hong Kong. The deal is dependent on all shareholders involved in the restructuring process, and should it be accepted, it would see all of the firm’s US$19 billion in offshore bonds swapped into new bonds and new shares in its property services and electric vehicle subsidiaries. As of March 21, Evergrande’s shares have been halted.
The deal is also intended to help the company hopefully reach agreement with its onshore creditors and resume its business operations. Evergrande has been the poster-child for Chinese property sector, which has been hit hard by an overbuilding crisis.
In related news, Hui Ka Yan, commonly referred to as China’s Warren Buffet, is the chairman of Evergrande and has been leading the efforts to restructure the company’s debts. He is a major figure in the Chinese real estate industry and ranked 7th on Forbes 2019 list of the world’s richest people. Ka Yan joined Evergrande in 2002 as the executive director and chairman and has been instrumental in the transformation of the company into one of the largest property developers in the country.
Evergrande has been a leader in implementing some of the most innovative building technologies and their focus on making investments in research and development speaks to their commitment to remain competitive in the industry. The firm’s new restructuring agreement and commitment to real estate could mean a brighter future ahead.