Evergrande dangles sweeteners for time from bondholders and creditors to deliver a workout plan for the world’s largest real estate debt woes

Evergrande is promising global bondholders and creditors asset packages, and outlined what it called preliminary principles for restructuring its offshore debt

The asset packages may include shares of China Evergrande New Energy Vehicle Group and Evergrande Property Services Group, the company said

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Hui Ka-yan , the founder and chairman of China Evergrande Group, during a 2017 press conference in Guangzhou. Photo: Getty Images.

Martin Choi,Chad Brayin LondonandPearl Liu

Published: 6:30am, 30 Jul 2022Updated: 7:20am, 30 Jul 2022

China Evergrande Group is promising its global bondholders and creditors asset packages that may include shares of two offshore listed units as sweeteners, as it seeks to buy time to deliver a restructuring plan for US$300 billion of liabilities due to the “complexity and scope” of its businesses.

The company outlined what it called “preliminary principles” for restructuring its offshore debt, in a statement late on Friday night to the Hong Kong stock exchange, two days before the July 31 deadline for its long-awaited debt workout plan. The company said it hopes to achieve “further positive progress” in a detailed plan some time in 2022, without giving specifics.

Evergrande “looks forward to a constructive dialogue with the onshore and offshore creditors and gain their timely support … to better manage various businesses, treat onshore and offshore creditors fairly, and safeguard the rights and interests of all stakeholders in accordance with the law”, the company said in a five-page statement issued in the name of its founder and chairman Hui Ka-yan.

The company said it would arrange asset packages in compliance with the law as “supplemental credit enhancements” for the restructured offshore debts, which may include shares of China Evergrande New Energy Vehicle Group and Evergrande Property Services Group.

China Evergrande Group’s Haihua mega-project, or Ocean Flower, on an artificial island in Danzhou in southern China’s Hainan province on Nov. 19, 2019. Photo: Chinatopix Via AP

“The group is working closely and communicating regularly with creditors and the advisers of creditors on conducting an orderly and necessary due diligence of the group’s core business, discussing potentially practicable restructuring proposal options for the offshore debts,” the Shenzhen-based developer said.

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