China’s Evergrande seeks legal advice on rural land in Hong Kong

The company logo is seen at the headquarters of the China Evergrande Group in Shenzhen, Guangdong province, China September 26, 2021. REUTERS/Aly Song/File Photo

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HONG KONG, Jan 30 (Reuters) – China Evergrande Group said on Sunday recipients had been named for undeveloped land in Hong Kong’s rural Yuen Long district in the latest development to hit the indebted developer.

A source with direct knowledge said the creditor is Oaktree. However Evergrande did not mention the name in the statement.

The assets are pledged as collateral for a $520 million financing deal advanced to the group in January 2021, Evergrande said in a Hong Kong stock exchange filing.

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“The company is seeking legal advice to protect the legal rights of the company. At the same time, the company is in active discussions with the lender to resolve the issue with a view to reaching a resolution, thereby maximizing the return for the group.”

If there is any residual value on the assets after the secured bonds have been paid, Evergrande said it would prioritize offshore business.

He said the appointment of receivers for the subsidiaries and the potential sale of the relevant secured assets “would not have a material impact on the group’s operations or financial condition, nor would it affect the debt restructuring exercise. in progress of the group”.

Evergrande said on Wednesday it aims to have a preliminary restructuring proposal in place within six months as it struggles to reassure creditors spooked by defaults since its finances began to deteriorate last year. last. Read more

Contacted by Reuters, Oaktree declined to comment.

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Reporting by Farah Master and Clare Jim; edited by Barbara Lewis

Our standards: The Thomson Reuters Trust Principles.

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