China Evergrande, a trapped real estate developer, said that a subsidiary of its subsidiaries was told to perform the guarantee liability of $ 1.1 billion (about S $ 1.17 billion).This reveals another major financial obligation that has not been disclosed before.
According to the Wall Street Journal, China Evergrande said in an announcement submitted last Sunday (July 31) that it was a subsidiary in China with the shares of Shengjing Bank Co., Ltd.An unnamed entity provides anti -guarantee pledge.Shengjing Bank is a regional loan agency located in Shenyang, Liaoning Province, Northeast China.
The pledged shares involved all 14.6%of China Evergrande in Shengjing Bank.Related shares are part of an intricate financial arrangement. In this arrangement, the unknown entity provided guarantee for the borrower controlled by China Evergrande in July 2021.
The loan of these borrowers defaulted, resulting in the unnamed entity that needed to repay RMB 7.3 billion.Subsequently, the entity asked for arbitration for Evergrande subsidiaries who provided anti -guarantee pledge.
China Evergrande said it received a ruling on July 25, and the ruling stated that the entity had the right to pay priority to the relevant Shengjing Bank shares.
This global liability developer with the most liabilities occurred at the end of 2021, which has faced the difficulty of creditors.The holders of bonds expressed dissatisfaction with the debt that China Evergrande had not disclosed before the payment of large funds, which may affect how much capital investors can recover.
Last month, China Evergrande pledged most of its cash before disclosing its property service department to help third parties borrow money, and dismissed its chief executive and chief financial officer.After the pledge -related loan is transferred back to Evergrande through the transfer.
When the loan of these third -party borrowers facilitates contract, the bank seized about $ 2 billion in cash for the property service company.According to the Wall Street Journal report last week, a group of overseas creditors in Evergrande in China asked the company to further explain how these arrangements were carried out.
Last Friday (July 29), China Evergrande disclosed the rough outline of the debt restructuring plan, saying that foreign creditors may eventually get debts supported by key assets abroad, including their propertyService department and electric vehicle business.
The company did not explicitly explain how much its overseas debt plan was reduced by about $ 20 billion, but it promised to treat creditors and their creditor rights fairly.As of June 2021, Evergrande's debt exceeded $ 300 billion.The company has promised to announce an overseas debt restructuring plan by the end of the year.
China Evergrande originally bought Shengjing Bank in 2016. At that time, the real estate giant was expanding and invested in a series of non -main assets, including a football team and a bottle water plant.By 2019, China Evergrande has become the largest shareholder of Shengjing Bank, holding 36%of the shares.Shengjing Bank provided loans to Evergrande.
Last year, China Evergrande sold a five -fifth of the shares of Shengjing Bank to a state -owned enterprise with a transaction value of about 1.5 billion US dollars.At that time, Shengjing Bank demanded that Evergrande's sale of this part of the assets to repay the arrears of the bank.
Nicholas Chen CHELAS Chen Creditsights analysts of credit research institutions said: "The existence of not disclosed pledge guarantees is very worrying, but it is not completely surprising for us."The funds that overseas debt holders can recover will be greatly reduced.
