Shares in crisis-hit Chinese property giant Evergrande dive as trading resumes following 17-day suspension
Shares in crisis-hit Evergrande plunged in Hong Kong after the stock started trading again following a 17-day suspension.
Shares in the Chinese property giant, which is cracking under the weight of a £221billion debt pile, were suspended on October 4 after it said it may have found a buyer for Evergrande Property Services (EPS), one of its most profitable businesses.
But the deal to sell just over 50 per cent of EPS to rival Hopson Development collapased, depriving it of valuable cash to ease the pressure on its balance sheet.
On the brink: Chinese property giant Evergrande is cracking under the weight of a £221bn debt pile
Shares resumed trading yesterday following the news – falling 12.5 per cent. The latest decline means the shares have crashed nearly 82 per cent so far this year.
The situation has reignited fears that cash-strapped Evergrande, the world’s most indebted company, could collapse.
The firm is facing a critical repayment deadline tomorrow which, if missed, will mean it has officially defaulted on some of its loans.
If it goes bust, there are concerns it could spark a domino effect across China’s vast property development sector and spread to the wider economy.